Sri Lanka not pressured into loan deal with China

Source:Global Times Published: 2018/8/30 21:03:41

Sri Lankan Ambassador to China Karunasena Kodituwakku Photo: Courtesy of the Sri Lankan Embassy in Beijing



 

Illustration: Luo Xuan/GT



Editor's Note:

With its strategically important geographic location, Sri Lanka has become a key point in the China-proposed Belt and Road (B&R) initiative. But after a port project developed by Chinese companies in Sri Lanka failed to achieve satisfactory performance and was acquired by Chinese firms, projects under the B&R initiative have become a target of rising global criticism. However, Sri Lankan Ambassador to China Karunasena Kodituwakku (Kodituwakku) painted a completely different picture of the situation in a recent interview with Global Times (GT) reporter Wang Cong.

GT: What is your response to recent criticism of the Hambantota port in Sri Lanka?

Kodituwakku: What I would like to highlight here is that Sri Lanka asked for this project loan on our own. We were not forced into it. Some people are trying to suggest that it's a new kind of colonialism. If China had forced us to take this loan and build this project or any other project, it would be fair enough for people to say that. But in the case of Hambantota, the Sri Lankan leadership at that time decided to get the loan from China.

It's very unfair to blame China or the Export-Import Bank of China or the firms that constructed the port. It was a decision taken by the government of Sri Lanka to apply for the concessional loan. It's not fair to pass that responsibility to anybody else.

GT: How has the Hambantota port been running so far?

Kodituwakku: As I mentioned, we have taken out a $1.4 billion loan. So we have to pay it back in order to maintain our good name. It seems we were not in a position to run the port viably and pay back loans with the revenue earned from the port. We decided to seek assistance from experienced shipping management firms. That's how China Merchants Group came into the picture. So we have formed a public-private partnership between the Sri Lanka Ports Authority and China Merchants Group.

Now they are running it on a 99-year lease basis. But of course, after 70 years, we will be in a position to buy back the shares owned by China Merchants Group. We have to evaluate the asset at that time and offer the appropriate value. They just started to run it a year ago but all indications and signs show that it is moving forward and we are very optimistic about the future.

GT: What is your view of the China-Sri Lanka cooperation? What does Sri Lanka need from China?

Kodituwakku: The relationship between Sri Lanka and China is very cordial. In fact, when China organized the Belt and Road Forum for International Cooperation in 2017, Sri Lanka was invited as one of the main participants and Sri Lankan Prime Minister Ranil Wickremesinghe attended the event. So our commitment to the B&R initiative is continuing.

We need more trans-shipment business at Hambantota. At the same time, we would like to build a good industrial base in the surrounding areas. For the port to be more viable, we need a sufficient export base in the surrounding areas. Therefore, we would like to ask the Chinese business community to come to Sri Lanka and invest in building an industrial base around the port. The success of Hambantota will depend on the cooperation we receive from Chinese enterprises.

GT: How does the Sri Lankan government view the reported $39 million military assistance from the US?

Kodituwakku: I have seen the media reports about this. The US government has a new strategy for the Indo-Pacific region. So they would like to extend support not only to Sri Lanka but to many other countries in the region. Whenever we are offered assistance, we will consider these things very positively as long as the assistance does not affect us or our region negatively. In particular, we are keen to create a peaceful situation in the Indian Ocean. If any of the assistance could negatively affect that, we would not accept it.

But I would like to mention that when we had a very difficult time, when Sri Lanka was suffering from war and terrorism, none of those Western countries that are now coming to offer help were there.

China was one of the few countries that extended support to Sri Lanka at that time.



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