Sri Lanka for sale?

Capital suggestion

On May 29, the BBC asked, “Is Sri Lanka up for sale?” According to the BBC, “Sri Lanka is allowing Chinese firms to take over key assets, as it struggles to repay loans it was given by China”. In 2007, the EXIM Bank of China began funding Sri Lanka’s Hambantota Port. The port was completed at a cost of $1.3 billion. The Chinese financed and built the 900MW Norochcholai Power Plant at a cost of $1.35 billion. In 2010, Beijing lent Sri Lanka $200 million to build an airport. In 2012, China lent an additional $810 million.

In 2011, the Mahinda Rajapaksa International Cricket Stadium was built at a cost of Rs700 million. In 2013, the Mattala Rajapaksa International Airport (near Hambantota) was built at a cost of Rs26 billion. The Southern Expressway was built at a cost of Rs776 billion. The Hambantota Sports Zone was built at a cost of Rs15 billion. In 2013, China lent to Sri Lanka and built $272-million railway.

Between 2008 and 2015, China lent $6 billion in aid and loans. Fast forward to 2017. The port of Hambantota now lies, more or less, abandoned. The Rajapaksa National Tele Cinema now lies, more or less, abandoned. The Mahinda Rajapaksa International Cricket Stadium now lies, more or less, abandoned. The Mattala Rajapaksa International Airport now lies, more or less, abandoned.

Lo and behold, Sri Lanka is having trouble repaying the debt incurred to build the port of Hambantota. As a consequence, Beijing has now taken over four of the seven container berths on a 35-year lease. Beijing is also acquiring 15,000 acres around Hambantota.

Lo and behold, Sri Lanka is having trouble repaying the debt incurred to build the coal-fired Norochcholai Power Plant. On April 17, 2017, the power plant broke down. On March 13, 2016, the power plant had ceased operations. In 2012, there was a leak in one of the boilers. Sri Lanka wants China to take over the power plant.

Lo and behold, Sri Lanka is having trouble repaying the debt incurred to build the Mattala Rajapaksa International Airport. Sri Lanka offered China control over some of the largest projects – including the Mattala International Airport and the Port of Hambantota – in return for debt relief.

According to Forbes, “Sri Lanka has a debt problem. After more than a decade of taking out huge loans to build large-scale infrastructure – most of which hasn’t yet produced adequate returns – the country is now struggling to make payments, and is looking for another way out”. Prime Minister Ranil Wickremesinghe is prepared to give control of large projects to Chinese companies. But according to Forbes, China’s Ambassador Yi Xianliang has clearly told PM Ranil Wickremesinghe that: “We are not interested. We want our money, not your empty airport”.

Sri Lanka is having trouble repaying its debt. Sri Lanka now owes $58.3 billion to foreign lenders and 95.4 percent of Sri Lankan government’s revenue is now going into debt-servicing.

According to the BBC, “We don’t like our land being given away to China,” says fisherman Aruna Roshantha, adding that “Not just China, if any country comes and takes land from Sri Lanka, we don’t like it. The government should protect our land, not sell it”.

The writer is a columnist based in Islamabad.

Email: farrukh15@hotmail.com. Twitter: @saleemfarrukh