Sri Lankan president Gotabaya Rajapaksa in an interview with Bloomberg News said that China is shifting its strategic focus towards southeast Asia and Africa, highlighting that neither his own country or Pakistan got Beijing’s attention as they face an economic crisis.
Rajapaksa, who is facing calls from the people to step down for leading Sri Lanka into this economic crisis, said that his fault was not going to the International Monetary Fund (IMF) earlier, expecting that tourism and remittances would recover the economy before forex reserves dwindled and reached the state it currently is in.
“If we had gone at least six months or one year earlier, it would not have come to this state,” Gotabaya said.
He also acknowledged that the Indian government led by Prime Minister Narendra Modi went out of its way to urge the IMF to expedite the processes that could help Sri Lanka mitigate the crisis.
“China shifted their strategic focus into Southeast Asia. They see more strategic interest in the Philippines, Vietnam and Cambodia, that region, and Africa,” Rajapaksa was quoted as saying by news agency Bloomberg News. He said that Beijing dislikes lending money to cover earlier debt payments.
“I don’t know whether I am right or wrong, even the focus on Pakistan has gone down,” he further added.
Rajapaksa was right as Colombo and Islamabad have been among the biggest recipients of Chinese loans, rather than investments, as it lent billions of dollars in credit to allow Sri Lanka and Pakistan to build ports, power plants and other infrastructure.
China is cautious now and is taking its time in reissuing a loan to Pakistan and responded tepidly to Colombo’s request for fresh credit as the IMF discusses non-negotiables with both nations in order to extend credit.
China also blocked Sri Lanka from taking money from an existing $1.5 billion credit line fearing the IMF may term this as a loan and add it to the debt stock, Sri Lankan government officials told Bloomberg.
The embattled president also said that he personally wrote to PM Modi and Chinese president Xi Jinping. He also reached out to counterparts in west Asia to secure oil-supplies and alleviate the fuel crisis.
The island nation is suffering its worst economic crisis since its independence in 1948, with a shortage of forex reserves stalling essential imports.
Meanwhile, Sri Lankan prime minister Ranil Wickremesinghe on Tuesday said that the island-nation will need at least $5 billion in the next six months to ensure that its citizens can maintain basic standards of living.
He also said that some $3.3 billion for fuel imports will also be required to alleviate the fuel crisis. “We have to restructure the entire economy, only establishing economic stability is not enough,” Wickremesinghe was quoted as saying by news agency Reuters.
(with inputs from Bloomberg and Reuters)
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