In 2022, Sri Lanka exhausted its foreign currency reserves needed to pay for crucial imports and announced it couldn't repay its $46 billion debt owed to other countries.
Now, the Prime Minister of Sri Lanka, Dinesh Gunawardena, said that China agreed to help upgrade Sri Lanka's big sea port and airport in the capital. China is Sri Lanka's biggest money lender, so this is a big deal. They also promised to help Sri Lanka manage its debt, which is important to keep getting financial help from the IMF.
Even though China hasn't said exactly how they'll help with the debt, Sri Lanka thinks they might make the debt easier to pay back by giving more time or lowering interest rates.
This news comes after months of protests that led to the previous president stepping down.
The Prime Minister's office said China is also going to help with the development of the airport and port, but didn't give many details.
Before this, there were plans to expand the airport, but they were stopped because of Sri Lanka's debt problem.
In 2017, Sri Lanka let a Chinese company run the Hambantota port for 99 years, which made India and the US worried because it's a strategic location in the Indian Ocean.
Sri Lanka says they won't let the ports be used for military stuff, but India doesn't like Chinese ships stopping there because they're worried about spying.