China is strengthening its influence in Sri Lanka.
The Indian Ocean island will borrow $ 2.2 billion (€ 1.9 billion) from Chinese banks.
The government hopes to "
finalize within two weeks
" a
$ 1.5 billion "
swap agreement
" with the Central Bank of China, the Secretary of State for Capital Markets said on Wednesday. Nivard Cabraal.
The sum will serve as a "
buffer
" to meet the country's foreign exchange needs, he said.
Sri Lanka, whose economic capital is Colombo, is also negotiating a loan of 700 million dollars with the Chinese Development Bank.
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The country's reserves fell to $ 4.8 billion at the end of January, their lowest level in a decade, raising the threat of default.
These sums, which will add to billions already borrowed from China to finance huge infrastructure projects, are raising fears that Sri Lanka is trapped by its Chinese debt.
The agencies
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