Middle East

Sri Lanka seeks loan from Qatar for oil imports during central bank crisis-Doha News

Sri Lanka has been in default for the first time in history after fighting the worst financial crisis in more than 70 years.

Sri Lanka sought a loan from Qatar to import oil as the country’s central bank crisis worsened, the Minister of Electricity and Energy announced Tuesday.

Minister Kanchana Wijesekera met with the Vice-President of the Qatar Development Fund to discuss possible credit line facilities for gas and oil supplies.

Credit lines allow individuals to borrow money in stages, repay and borrow again, as long as the line is open.

“Funds have been allocated to medicines and we have been informed that we will consider credit line requests and support the IMF program,” Wijesekera said. twitter on tuesday.

The Minister of South Asia also met with Qatar Energy CEO and Qatar Energy Minister Saad Sherida Al Kaabi. Discuss Supply of oil, liquefied petroleum gas, and liquefied natural gas to his country to mitigate the ongoing energy crisis.

In April, Sri Lanka contacted several countries regarding bilateral credit requests, as a comprehensive aid package from the International Monetary Fund (IMF) could take about six months.

Bilateral credit involves a situation in which two or a group agree not to require payment of debt for a specific period of time.

India is providing “every conceivable support,” Foreign Minister Gamini Lakshman Payris told reporters at a briefing in Colombo in April. Bloomberg.. Sri Lanka is also seeking support from Japan, Oman, and other Gulf Cooperation Council (GCC) countries.

Sri Lanka still wants immediate help under the emergency program, and talks with the IMF are on the right track, Payris said. However, it took about six months for the full package to be delivered, “you need to find a bridge loan,” he added.

Sri Lanka is aiming for $ 4 billion worth of emergency assistance this year alone to help mitigate power outages over hours, shorten fuel lines for miles, and pay for life-saving medicine and food imports.

In May, 22 million countries defaulted. This was the government’s failure to meet some or all of its debt, raising $ 78 million for a 30-day grace period. The payment of unpaid debt interest has expired. The government is struggling to stop the collapse.

South Asian countries aim to “rebuild over $ 50 billion in debt to foreign creditors to make repayments more manageable.” BBC report.

Sri Lanka Grappling The tax cut by President Gotabaya Rajapaksa “has exhausted the government’s financial resources” (the money the organization has in its bank account and can be used), which has led to a serious economic crisis.

The Covid-19 pandemic has also hit the country’s tourism sector. This is an important element of the country’s economy, and soaring oil prices have “emptied foreign exchange reserves.”

Inflation rate rose from 29.8% in April of the same year to 39.1% in May 2022.

https://dohanews.co/sri-lanka-eyes-loan-from-qatar-for-oil-import-amid-central-bank-crisis/ Sri Lanka seeks loan from Qatar for oil imports during central bank crisis-Doha News

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