Press Releases

The Government of Sri Lanka and the China Development Bank entered into an agreement on April 12, 2021 for a financing facility of USD 500 million, signed by Dr. Palitha T.B. Kohona, Ambassador of Sri Lanka to the People’s Republic of China on behalf of the Government of Sri Lanka and Mr. Wang Wei, Deputy Director General, China Development Bank on behalf of the China Development Bank.

The facility has been made available, on a request made by the Government of Sri Lanka to the Chinese Government and the China Development Bank to support the country’s development efforts.

It is noted that this is part of the Foreign Currency Term Financing Facility (FTFF) 2020 signed on March 18, 2020 where , the terms of this facility remains at 10 years with a grace period of 3 years, this is an improvement over the foreign currency term financing facility drawn down in 2018 from the China Development Bank . The financial cost of borrowing when compared to the current market conditions is competitive with the interest rate being an improvement over the 2018, China Development Bank facility with the margins over 6months LIBOR being less than that of the 2018 facility. The USD 500 million will be disbursed, during this week.

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The government of Sri Lanka entered into loan and grant agreements with the Asian Development Bank (ADB) to obtain a loan of USD 165 million and grants worth of USD 3 million from the Japan Fund for Poverty Reduction (JFPR), to provide a credit line to the Small and Medium – Sized Enterprises (SMEs) through ten qualified Participating Financial Institutions (PFIs). The Ministry of Finance will be the Executing Agency of the Project, “Third Additional Financing of the Small and Medium – Sized Enterprises Line of Credit (SMELoC Third Additional Financing) Project” funded under the above loan and the grants.

In accordance with the National Policy Framework of the Government “ Vistas of Prosperity & Splendour”, it was decided to provide more assistance to the SME Sector by providing an additional loan of USD 65 million to upgrade and strengthen SME sector to meet the expectations of the country as the initial loans, USD 100 million USD 75 million from ADB have already been utilized. The Government’s objective is to maximize the beneficiaries of these financial assistance which are currently recorded as 1,755 SMEs supported by the first loan and 1,774 SMEs supported by the second loan and supplementary We-Fi grant, which is USD 9.5 million.

With the outbreak of coronavirus pandemic in early 2020, the Government requested to top up the initially planned loan of USD 65 million with USD 100 million as more assistance is required to mitigate the negative impact on SMEs. Accordingly, out of the total USD 165 million;

1. USD 100 million will be allocated as SME Emergency Response Component for re-energizing the affected SMEs by providing short-term working capital in the productive sectors including, manufacturing, agriculture & agro processing, fisheries, tourism, export oriented businesses etc.
2. USD 45 million will be allocated for the continuation of the ongoing SME credit line
3. USD 20 million will be allocated for providing affordable credit line to tea smallholders on a pilot basis (This component will be supported by USD 3 million technical and financial Grants)

The loan funds will be channeled through ten qualified PFIs, namely People’s Bank, Bank of Ceylon, Pradeshiya Sanwardana Bank, Commercial Bank of Ceylon Public Limited Company (PLC), Sampath Bank PLC, Hatton National Bank PLC, DFCC Bank PLC, National Development Bank PLC, Nation’s Trust Bank PLC and Seylan Bank. The overall project is scheduled to be completed by 30th September 2023.

In this connection, Mr. S R Attygalle, Secretary to the Ministry of Finance on behalf of the Government of Sri Lanka and Mr. Chen Chen, Country Director of ADB Sri Lanka Resident Mission on behalf of ADB, signed the Loan and Grant Agreements to obtain USD 165 million worth of loan and USD 1.25 million worth of grant on 25^th November 2020 at the Ministry of Finance.

This Press Release is issued by the Department of External Resources on 25^th November 2020.

The Government’s Development Policy Framework, “Vistas of Prosperity and Splendor” envisages harnessing the power of the country’s youth, who account for almost one fourth of the total population, and engaging them as proactive partners in the country’s sustainable development process. Accordingly, the Government of Sri Lanka entered into a budgetary support loan worth of USD 400 million with ADB, under the Results Based Lending (RBL) financial modality to finance the Secondary Education Sector Improvement Program (SESIP). The above loan, which was borrowed at an annual interest rate of LIBOR + 0.5%  has a repayment period of 26 years including a 5 years grace period.

The proposed Secondary Education Sector Improvement Program (SESIP) will support the Government’s General Education Sector Development Plan, 2020–2025 in strengthening the country’s secondary education system. SESIP will institutionalize systems for enhancing secondary students’ learning outcomes through (i) enhancing the quality and relevance of secondary science, technology, mathematics, and commerce (STMC) programs; (ii) strengthening provincial and school capacity to implement education reforms; and (iii) strengthening sector management capacity.

 The outcome of the Program will be the transformation of the education system as a basic foundation for human resource development for a knowledge-based modern global economy in line with the national policy framework. The SESIP also focuses on the new strategies such as online learning and teaching, blended learning; distance mode education in line with the Government’s plan to address the COVID 19 disruptions.

The Ministry of Education will be the Executing Agency for the above Program, whereas the State Ministry of Education Reforms, Open Universities and Distance Education Promotion, State Ministry of Women and Child Development, Pre-School and Primary Education, School Infrastructure and School Services and nine Provincial Education Departments (PEA) will be the implementing agencies to the Program.

In this connection, Mr. S R Attygalle, Secretary to the Ministry of Finance on behalf of the Government of Sri Lanka and Mr. Chen Chen, Country Director of ADB Sri Lanka Resident Mission on behalf of ADB, signed the Loan Agreement to obtain USD 400 million on 1^st December 2020 at the Ministry of Finance. 

This Press Release is issued by the Department of External Resources on 1^st  December 2020.

Foreign Currency Term Financing Facility (FTFF) for the Government of Sri Lanka - 2020

In response to the notice calling for Request for Proposals (RFPs) for FTFF dated 17.06.2020 and 29.06.2020 it is informed that as at  17 .07.2020 the following proposals have been received:

a.      Hongkong and Shanghai Banking Corporation Limited and/or its affiliates, State Bank of India, Singapore Branch, and Credit Suisse AG, Singapore Branch, and/or its affiliates

b.      Acuity Partners (Pvt) Ltd  and Industrial & Commerce Bank of China (London) PLC

Sgd: Secretary, Ministry of Finance, Economic and Policy Development/Secretary to the Treasury.

17.07.2020