Tag : Road

    China's BRI Trapped Sri Lanka In Debt, Chaos

    Sunil Aswal
    April12/ 2022

    New Delhi: China’s One Belt One Road (OBOR), now known as the Belt and Road Initiative (BRI), was announced in 2013 and it seems it has one purpose only — subjugation of the economically fragile nations on the way to becoming a great power by the time the Chinese Communist Party (CCP) celebrates 100 years. There are numerous examples of countries, developed and developing, which are economically fragile that have become even more fragile courtesy the OBOR. The recent situation in Pakistan and Sri Lanka is case in point. The Centre for Global Development in a 2018 study of countries hosting OBOR projects found 23 of them in a state of debt distress. Sri Lanka has taken loans from China, at lending rates in the range of 3-6 per cent against the 1-3 per cent offered by the World Bank and International Monetary Fund (IMF). As a result, Sri Lanka has had to request China for a debt-to-equity swap, selling their own equity to Chinese companies as they have not been able to pay back their loans. China’s investment of an estimated $1.4 billion in Sri Lanka’s Colombo Port City project is the largest single foreign investment in the island nation’s history. Dubbed as a Public-Private Partnership (PPP) between the government of Sri Lanka and the CHEC Port City Colombo (CPCC) Pvt Ltd, the project has been much publicised for the employment opportunities and huge revenues which it would generate for the Sri Lankans. What is seldom spoken about is the fact that of the 269 hectares of reclaimed land, 43 per cent will be controlled by the CPCC through a 99-year lease agreement. This is reminiscent of the not too long-ago takeover of the Hambantota Port on a 99-year lease by China Merchant Port Holdings (CMPH). The port is now operated ‘jointly’ by ...

    Continue Reading