China Extends Currency Swap Deal with Sri Lanka

China has renewed its 10 billion yuan currency swap facility with Sri Lanka for three more years. The agreement was initially signed in 2021, and its extension was announced following Sri Lankan President Anura Kumara Dissanayake's visit to China.

In a significant financial development, China has renewed its currency swap facility worth 10 billion yuan (approximately USD 1.4 billion) with Sri Lanka for an additional three years. This renewal follows a bilateral agreement initially signed in 2021, according to a statement from the Central Bank of Sri Lanka.

The extension was confirmed in a joint statement at the end of President Anura Kumara Dissanayake's official four-day visit to China. This move reflects growing economic ties between the two nations, further cemented during Dissanayake's second overseas trip since taking office in September. His first visit as president was to India in December last year.

This currency swap agreement, first established during the tenure of ousted President Gotabaya Rajapaksa, serves as a critical financial tool to support Sri Lanka's economy amid its ongoing challenges. The extension indicates Beijing's continued commitment to bolstering financial support for Colombo.

(With inputs from agencies.)