Sri Lanka seeks $1 billion loan from China amid debt woes

FILE - In this Jan. 2, 2018 file photo, a Chinese construction worker stands on land that was reclaimed from the Indian Ocean for the Colombo Port City project, initiated as part of China's ambitious One Belt One Road initiative, in Colombo, Sri Lanka. Sri Lanka's Finance Ministry spokesman M.R. Hasan said Saturday, Feb. 2, 2019, that he's waiting to hear whether terms of a $1 billion loan from China to construct a highway linking the capital Colombo to the hilly resort city of Kandy for the highway project have been approved. President Maithripala Sirisena's government had criticized the previous administration of strongman Mahinda Rajapaksa for leading the country into a Chinese debt trap. However, the government has turned to China to help relieve economic pressures. (AP Photo/Eranga Jayawardena, File)

Sri Lanka is negotiating a $1 billion loan from China, even as the heavily-indebted South Asian island nation makes arrangements to pay down $5.9 billion in foreign loans this year

COLOMBO, Sri Lanka — Sri Lanka is negotiating a $1 billion loan from China to construct a highway linking the capital Colombo to the hilly resort city of Kandy, even as the heavily-indebted South Asian island nation makes arrangements to pay down $5.9 billion in foreign loans this year.

Finance Ministry spokesman M.R. Hasan said Saturday that he's waiting to hear whether terms of the loan for the highway project have been approved.

A large chunk of Sri Lanka's foreign debt is from China, which sees Sri Lanka as a key link in its transcontinental Belt and Road infrastructure initiative.

President Maithripala Sirisena's government had criticized the previous administration of strongman Mahinda Rajapaksa for leading the country into a Chinese debt trap. However, the government has turned to China to help relieve economic pressures.

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