Sri Lanka seeks cheap oil from the UAE

Sri Lanka seeks cheap oil from the UAE
Sri Lanka seeks cheap oil from the UAE

Sri Lanka, which is facing an acute shortage of foreign currency, is seeking cheap oil from the UAE, the Sri Lankan authorities announced on Saturday.

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Sri Lankan Foreign Minister Gamini Lakshman Peiris contacted the UAE Minister of Industry and Advanced Technology Sultan Al Jaber, on the sidelines of the United Nations General Assembly meetings in New York to reach a special agreement, according to a ministry statement.

“The challenges that Sri Lanka is currently facing in terms of its external budget due to the Covid-19 pandemic,” Peiris explained, according to the ministry.

“The minister focused in particular on the country’s oil needs and requested concession agreements from the UAE, which said it was happy to provide assistance,” the statement added.

After its economy contracted by 3.6 percent last year, the dollars allocated to finance basic imports, especially foodstuffs and fuel, began to run out from commercial banks in Sri Lanka, while the crisis was worsening.

Media reports said Sri Lanka may also seek a $500 million loan from neighboring India to fund emergency oil imports.

Earlier this week, the government requested an emergency loan of $100 million from the World Bank for the vaccination campaign against the Corona virus.

Sri Lanka’s foreign reserves amounted to $3.55 billion at the end of August, while the country is supposed to repay about $2 billion in foreign debt before the end of the year.

And last Wednesday, the government raised its debt ceiling by 400 rupees, equivalent to 1.7 billion euros, to be able to cover its expenses over the next three months.

Source: AFP

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