Reply to thread

Message: <blockquote data-quote="senal7" data-source="post: 19981648" data-attributes="member: 485378">             Sri Lanka Accepts Chinese Demands to Avoid Debt Trap                                                                   <a href="http://gdb.voanews.com/5C81AC74-369C-4CBF-8DAA-5BD21B016510_mw1024_s_n.jpg" target="_blank"><img src="http://gdb.voanews.com/5C81AC74-369C-4CBF-8DAA-5BD21B016510_w640_r1_s.jpg" alt="" class="fr-fic fr-dii fr-draggable " style="" /></a>Sri  Lanka's Prime Minister Ranil Wickremesinghe, (l) chats with Chinese  Premier Li Keqiang during a welcome ceremony outside the Great Hall of  the People in Beijing, April 7, 2016.                                                                                                                April 08, 2016 9:54 AM                                                         BEIJING— Sri Lanka has agreed to resume work on a Chinese-funded $1.4 billion Colombo Port City project that had stalled a year ago.  The decision to restart work on the project was announced Thursday  during Sri Lankan Prime Minister Ranil Wickremasinghe's visit to  Beijing. The move opens the door for additional Chinese investments, and  helps China forward its goal of getting access to the Indian Ocean.  The Sri Lankan leader signed several other deals during his trip for  railway, road, port and airport projects that would be constructed by  Chinese companies in his country.  <a href="http://gdb.voanews.com/20071B66-EC14-4E2E-9294-E6B659538E4F_mw1024_s_n.jpg" target="_blank"><img src="http://gdb.voanews.com/20071B66-EC14-4E2E-9294-E6B659538E4F_w640_s.jpg" alt="" class="fr-fic fr-dii fr-draggable " style="" /></a>FILE  - A ship loaded with containers ready for departure is seen berthed at  the Chinese-majority owned Colombo International Container Terminal  (CICT) in Colombo on March 30, 2016.  The project has been the main point of contention between the two  countries since March of last year, when Wickremasinghe stalled the  project soon after coming to power. "We welcome the resumption of the  Colombo Port City project, and stand ready to work with Sri Lanka to  push forward the construction steadily,” Chinese Premier Li Keqiang  said, underlined the importance of the decision.  Debt trap  Analysts said the Sri Lankan leader's decision to resume work on the  project is a desperate measure to stop his country from heading towards a  debt trap. Sri Lanka is finding it extremely difficult to raise fresh  funds from the world market after international ratings firms Fitch and  Standard & Poor’s reduced the South Asian nation's credit rating in  February and March.  Sri Lanka wants China to reschedule past loans amounting to about $5  billion, and extend fresh loans. This includes Chinese finance for $1.6  billion to spend on a seaport and an airport in Hambantota, the home  region of former Sri Lankan President Mahinda Rajapaksa, who was known  to be close to China.  Financial problems and the need for infrastructure funding were the  main reasons behind Wickremasinghe’s decision to restart the Colombo  Port City project, according to Weerakoon Dushni, deputy director at the  Institute of Public Policy in Colombo. “Managing loan repayments is a  major problem. Nearly half of Sri Lanka’s external debt has been raised  on non-concessional and commercial terms,” she said adding, “We need to  engage with China both in political and economic terms.”  <a href="http://gdb.voanews.com/FBADB902-D884-4097-8814-A3BC9B3844BD_mw1024_s_n.jpg" target="_blank"><img src="http://gdb.voanews.com/FBADB902-D884-4097-8814-A3BC9B3844BD_w640_s.jpg" alt="" class="fr-fic fr-dii fr-draggable " style="" /></a>Sri  Lankan Prime Minister Ranil Wickremesinghe (2nd L) and Chinese Premier  Li Keqiang review an honor guard during a welcome ceremony outside the  Great Hall of the People in Beijing on April 7, 2016.  Some experts believe Sri Lanka has approached China for help because  India and the United States failed to provide assistance. “The major  task for Sri Lanka's current government is economic development. Yet  after its attempt to reduce its reliance on Beijing, Colombo has  realized that there is no alternative,” Zhao Gancheng, director of South  Asia Studies at the Shanghai Institute for International Studies told  the Global Times newspaper. “Over the past year, neither India  nor the U.S. has provided it with attractive mega-projects that China  did. It is therefore natural for Sri Lanka to turn around and embrace  China again,” Zhao said.  Indian Ocean connectivity  He also said Sri Lanka is trying to use its location on the Indian  Ocean to attract Chinese investments. “Apart from the already existing  cooperation, including the construction of Hambantota Port, Sri Lanka is  now expecting to use its own geographical position to ink more new  joint programs with China,” said Zhao.  China needs Sri Lanka to get access to the Indian Ocean, which has an  heavy presence of Indian and U.S. navies, for both military and  commercial reasons. It is pouring $46 billion on a corridor project that  would connect the Chinese border in Xinjiang to the Gwadar port on the  Arabian Sea in Pakistan, 1200 kilometers away.  “Sri Lanka is in the midst of important sea routes. China is engaging  with Sri Lanka partly because of strategic reasons. Besides, it is  focused on the 'One Belt, One Road program,' in which Sri Lanka can have  an important role,” said the Institute of Public Policy's Dushni.  Important question  An important question is whether Sri Lanka really needs the China backed projects.  <a href="http://gdb.voanews.com/2CAF63CE-9596-4D36-A7A0-A227FF8E7BD6_mw1024_s_n.jpg" target="_blank"><img src="http://gdb.voanews.com/2CAF63CE-9596-4D36-A7A0-A227FF8E7BD6_w640_s.jpg" alt="" class="fr-fic fr-dii fr-draggable " style="" /></a>works  at a construction site of an apartment complex in Colombo March 8,  2016. Sri Lankan Prime Minister Ranil Wickremesinghe, saying his country  must break out of a debt trap, on Tuesday announced a rise in value  added tax (VAT) and said the government will impose a capital gains tax.  “The Chinese funded airport in the Hambantota area has been used to  store gains. The Hambantota seaport, which was also financed by China,  has remained largely unused,” Smruti Pattanaik, research fellow at the  Institute of Defense and Strategic Studies in New Delhi, said.  Chinese backed projects, including the airport and sea port in  Hambantota and the Colombo Port City plan, have been a matter of raging  political controversies in Sri Lanka in recent years. During the 2014  elections, opposition leaders accused the associates of then-president  Rajapaksha of taking bribes from Chinese companies. Those critics are  now in power.  "The Sri Lankan government is in a real dilemma. It is almost  bankrupt and needs money to run the economy,” Chaminda Hettiarachchi,  lecturer and researcher at the Colombo University, said. “Sri Lanka  needs Chinese money at least in the short term. But Chinese projects are  not useful to the Sri Lankan people.”</blockquote>

Verification: Haya warak paha keeyada? (haya wadi kireema paha)

Top Bottom