Financial Times

Jap aid for power projects, debt relief frees $500m - Amunugama
Japan has promised aid for several power projects and, along with Sri Lanka's other development partners, agreed to freeze debt repayments that would release $500 million in this year's budget for tsunami relief and other work, Finance Minister Dr Sarath Amunugama said.

"My visit to Japan was extremely successful," he told The Sunday Times FT soon after returning from talks with the Japanese government in Tokyo. "We have been assured that, as far as the 2005 budget is concerned, our debt repayment can be postponed. Japan is our biggest development partner and a large slice of debt repayment would have gone to Japan. So the debt relief is a great boon to us."

Amunugama, who was accompanied by Treasury secretary Dr P.B. Jayasundera along with other officials, went to Japan on a three-day visit partly to thank the Japanese government for its prompt aid after the tsunami disaster, and also to hold talks on aid for development projects.

He said talks were going on about Japanese aid for the Upper Kotmale hydropower and Norochcholai thermal power projects. "They are also going to finance several other projects like repairs to the Ukuwela power station in the Mahaweli scheme and to make transmission lines more efficient," Amunugama said.

Amunugama held talks with Japan's Finance Minister Sadakazu Tanigaki, Foreign Affairs Minister Nobutaka Machimura, Governor of the Japan Bank for International Co-operation (JBIC) Kyosuke Shinozawa and President, Japan International Corporation Agency (JICA) Ms. Sadako Ogata.

His talks covered ongoing development projects in Sri Lanka, including fisheries, power and energy and irrigation sectors, in addition to special assistance to tsunami-affected regions. Japan gave a grant of US$ 81 million to Sri Lanka as emergency aid following the tsunami.

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