Sri Lanka to borrow USD760mn for roads from China

Dec 09, 2010 (LBO) – Sri Lanka will borrow 760 million US dollars from two state-banks in China to upgrade more than one thousand kilometres of roads in the island including key roads in former war-torn areas in the Northwest of the country, the government said. The government will borrow 500 million dollars from China Development Bank Corporation to rehabilitate 1,174 kilometres of “priority roads” with 158 million US dollars to be drawn down this, the government’s information office said.

The cabinet of ministers had also given to the nod to borrow 259.7 million US dollars from Export Import Bank of China to rebuild two roads in the north and a highway in the South of the island.

China’s Exim ank became the top lender to Sri Lanka this year in the first three quarters of the year. The Exim bank gives two types of credits, near commercial ‘buyers credit’ and more concessionary longer term ‘special buyers credit.’

A par to of the exim bank credit will be used to rebuild 67 kilometres of the Navatkulo-Karaitivy Mannar road and the 113 kilometers of the Puttalam-Marichchikade-Mannar in the Northwest of the island. The rest of the credit will be used to build 30 kilometres of Sri Lanka’s Southern highway running from Colombo to Matara in the South and