Commenting on the causes of Sri Lanka’s crisis situation People’s daily political commentator Feng Guoquan, who is based in China Says that the U.S.-led West has been pouring oil on the flames after setting fire
Sri Lanka has been in debt for many years, however, it has previously maintained a good record of foreign debt repayment and according to Feng Guoquan, It is the hegemony and the greed of capital of the U.S.-led West that are the root causes of the economic crisis faced by Sri Lanka and other developing countries.
Sanctions on Russia:
The commentator’s argument is that mounting sanctions imposed on Russia by the U.S.-led West have been pushing global food and energy prices to new heights, and there are also restrictions on Russian financial and aviation sectors. Feng Guoquan points out that the food prices surged in Sri Lanka due to soaring prices of wheat and corn triggered by the Russia-Ukraine conflict.
Sri Lanka exports about $150 million of tea and other commodities to Russia annually. However, as more and more Russian banks are banned from the SWIFT network, Sri Lanka was unable to obtain foreign exchange by exporting to Russia. In January this year, Russia was Sri Lanka’s largest source of tourists, but in March, the state-run national carrier of Sri Lanka suspended its flights to Russia due to the Western sanctions concludes Feng Guoquan.
Chines debt trap:
He argues that although there is talk of a Chines debt trap Sri Lanka has more borrowing on international sovereign bonds, than Japan and China while China comes third.
“According to the Central Bank of Sri Lanka data, as of October 2021, Sri Lanka’s international sovereign bonds reached $11.82 billion, accounting for 34.1 percent of total external debt. In terms of bilateral loans, Japan and India ranked first and second, with $3.54 billion (10.2 percent) and $790 million (2.3 percent) respectively, higher than China.”
Feng Guoqua argues that the crisis is not confined and it’s global
Scarcities of food, energy, and finance put more than 70 countries at risk of following Sri Lanka into default, says United Nations, The commentator points out that there is an attempt by the west to tarnish the image of China.