Beautiful Virgin Islands

Tuesday, Jun 03, 2025

Yellen says it's in China's interest to restructure Sri Lanka's debt

Yellen says it's in China's interest to restructure Sri Lanka's debt

China is a "very important" creditor of Sri Lanka and it would likely be in the interest of both countries if China participated in restructuring Sri Lanka's debt, U.S. Treasury Secretary Janet Yellen said on Thursday.
Yellen said she would urge other members of the Group of 20 major economies to put pressure on China to be more cooperative in long-stalled efforts to restructure the debts of countries in debt distress, including Sri Lanka.

Sri Lanka owes at least $5 billion to China although some estimates put it at almost twice that amount. India has also lent it $3.8 billion and Japan is owed at least $3.5 billion, according to the International Monetary Fund, with another $1 billion due to other rich countries.

"Sri Lanka is clearly unable to repay that debt, and it's my hope that China will be willing to work with Sri Lanka to restructure the debt," Yellen told a news conference on the sidelines of a meeting of G20 finance officials on the Indonesian island of Bali.

She declined to comment on recent events in Sri Lanka, where people are waiting for the resignation of President Gotabaya Rajapaksa, who has fled the country to escape a popular uprising as it struggles with an economic crisis.

Sri Lanka defaulted on its $51 billion of international debt in May after years of heavy borrowing and tax cuts by the government, plus the damaging impact of the COVID-19 pandemic.

The economy of the country of 22 million people began to show cracks in 2019 after large tax cuts by Rajapaksa's government drained the country's coffers.

The pandemic then shattered the lucrative tourism industry, and rising global prices have left Colombo struggling for essentials such as fuel, medicine and food.

Yellen singled out China for failing to cooperate in efforts to provide debt relief under the Common Framework adopted by G20 members and the Paris Club of official creditors in October 2020 to help heavily indebted low-income countries weather the COVID-19 pandemic.

Three countries - Zambia, Ethiopia and Chad - have applied for help under the framework, but those efforts have stalled, largely due to foot-dragging by China, now the world's largest sovereign creditor, and private sector creditors.

"More needs to be done to help the most vulnerable, and this is a key message I will be emphasizing at these G20 meetings," Yellen told reporters, citing the deteriorating global economic conditions that have pushed many developing countries into graver economic straits since Russia’s invasion of Ukraine.

"A key objective of this trip is to push G20 creditors, including China, to finalize debt restructurings for developing countries now facing debt distress," she said.

Yellen told reporters earlier this week that it was "quite frustrating" that China was not stepping up on the debt issues, and said Chinese leaders need to better coordinate among various Chinese lenders to developing economies.

Washington would also provide a grant of $70 million to the International Monetary Fund's Poverty Reduction and Growth Trust to further enable the IMF to continue making zero-interest loans to the world’s poorest economies, Yellen said.
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Dutch government falls as far-right leader Wilders quits coalition
Harvard Urges US to Unfreeze Funds for Public Health Research
Businessman Mauled by Lion at Luxury Namibian Lodge
Researchers Consider New Destinations Beyond the U.S.
53-Year-Old Doctor Claims Biological Age of 23
Trump Struggles to Secure Trade Deals With China and Europe
Russia to Return 6,000 Corpses Under Ukraine Prisoner Swap Deal
Microsoft Lays Off Hundreds More Amid Restructuring
Harvey Weinstein’s Publicist Embraces Notoriety
Macron and Meloni Seek Unity Despite Tensions
Trump Administration Accused of Obstructing Deportation Cases
Newark Mayor Sues Over Arrest at Immigration Facility
Center-Left Candidate Projected to Win South Korean Presidency
Trump’s Tariffs Predicted to Stall Global Economic Growth
South Korea’s President-Elect Expected to Take Softer Line on Trump and North Korea
Trump’s China Strategy Remains a Geopolitical Puzzle
Ukraine Executes Long-Range Drone Strikes on Russian Airbases
Conservative Karol Nawrocki wins Poland’s presidential election
Study Identifies Potential Radicalization Risk Among Over One Million Muslims in Germany
Good news: Annalena Baerbock Elected President of the UN General Assembly
Apple Appeals EU Law Over User Data Sharing Requirements
South Africa: "First Black Bank" Collapses after Being Looted by Owners
Poland will now withdraw from the EU migration pact after pro-Trump nationalist wins Election
"That's Disgusting, Don’t Say It Again": The Trump Joke That Made the President Boil
Trump Cancels NASA Nominee Over Democratic Donations
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OnlyFans for Sale: From Lockdown Lifeline to Eight-Billion-Dollar Empire
Mayor’s Security Officer Implicated | Shocking New Details Emerge in NYC Kidnapping Case
Hegseth Warns of Potential Chinese Military Action Against Taiwan
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Jamie Dimon Warns U.S. Bond Market Faces Pressure from Rising Debt
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Taylor Swift Gains Ownership of Her First Six Albums
Bangkok Ranked World's Top City for Remote Work in 2025
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
Russia's Fossil Fuel Revenues Approach €900 Billion Since Ukraine Invasion
U.S. Justice Department Reduces American Bar Association's Role in Judicial Nominations
U.S. Department of Energy Unveils 'Doudna' Supercomputer to Advance AI Research
U.S. SEC Dismisses Lawsuit Against Binance Amid Regulatory Shift
Alcohol Industry Faces Increased Scrutiny Amid Health Concerns
×