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Sri Lanka crisis

Bankrupt Sri Lanka holds breath for Paris Club's China overture

Five things to know about wealthy group's role in Colombo debt relief

A food vendor at Galle Face Green in Colombo: Sri Lanka needs to unlock $2.9 billion in funding from the International Monetary Fund, as a first step toward climbing out of bankruptcy.   © Reuters

COLOMBO -- As dollar-strapped Sri Lanka approaches the end of a grim economic year, officials in the South Asian nation are tuning in for encouraging signals from the Paris Club, a group of 22 wealthy countries that share debt relief deals. But a breakthrough hinges on a green light from top bilateral lender China, which is not a club member.

Colombo-based diplomats and Europe-based financial insiders with knowledge of the Paris Club's workings told Nikkei Asia that progress over the Sri Lanka question remains clouded. "No creditor committee work has started yet for Sri Lanka," revealed a highly placed source familiar with the discussions in the French capital.

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