PUBLISHED : Monday, 11 April, 2016,
China and Sri Lanka have vowed to develop an “all-weather” friendship, in a move analysts say is aimed at putting disagreements over infrastructure projects behind them.
But some observers believe that despite the pledge, Colombo’s new government plans to diversify the country’s diplomatic partners and dilute its reliance on Chinese investment.
Wrapping up a three-day trip to Beijing yesterday, Sri Lankan Prime Minister Ranil Wickremesinghe said Colombo planned legal reforms to encourage foreign investment. He asked China to accept equity in infrastructure projects in return for cancelling some of the US$8 billion Sri Lanka owes Beijing and offered to sell it stakes in Sri Lankan companies.
The countries also announced the resumption of a controversial US$1.4 billion project, the Colombo Port City, suspended for more than a year over irregularities in the contract arranged by Sri Lanka’s previous administration.
“The pledge to develop an all-weather friendship is a gesture to say change of government and politics will not affect the relationship,” said Du Youkang, professor of South Asia studies at Fudan University.
Sri Lanka upset Beijing last year when it ordered a review of the project, approved under the administration of former president Mahinda Rajapaksa, who had faced criticism domestically for too heavy a reliance on Chinese investment.
Faced with falling foreign reserves, Sri Lanka’s new administration under President Maithripala Sirisena, is hoping to boost investment from abroad.
Wang Dehua, a professor of South Asian studies at the Shanghai Institute for International Strategic Studies, said China would consider the equity swap.
http://www.scmp.com/news/china/diplomacy-defence/article/1935065/all-weather-friends-china-sri-lanka-agree-resume
“It allows Chinese companies to have a stake in Sri Lankan companies,” he said. “China is willing to consider different financing options for Sri Lanka.”
Srikanth Kondapalli, who teaches Chinese Studies at New Delhi’s Jawaharlal Nehru University, said despite pledges to resume the project, Colombo would not be as “desperate” as before to engage Beijing. He noted protests over Chinese investment and Sri Lanka’s push to engage countries such as Japan and India.
He said Colombo would not “put all its eggs in one basket”, and was still concerned that China would rely on its own workers for joint projects, meaning there would be no transfer of skills.
China and Sri Lanka have vowed to develop an “all-weather” friendship, in a move analysts say is aimed at putting disagreements over infrastructure projects behind them.
But some observers believe that despite the pledge, Colombo’s new government plans to diversify the country’s diplomatic partners and dilute its reliance on Chinese investment.
Wrapping up a three-day trip to Beijing yesterday, Sri Lankan Prime Minister Ranil Wickremesinghe said Colombo planned legal reforms to encourage foreign investment. He asked China to accept equity in infrastructure projects in return for cancelling some of the US$8 billion Sri Lanka owes Beijing and offered to sell it stakes in Sri Lankan companies.
The countries also announced the resumption of a controversial US$1.4 billion project, the Colombo Port City, suspended for more than a year over irregularities in the contract arranged by Sri Lanka’s previous administration.
“The pledge to develop an all-weather friendship is a gesture to say change of government and politics will not affect the relationship,” said Du Youkang, professor of South Asia studies at Fudan University.
Sri Lanka upset Beijing last year when it ordered a review of the project, approved under the administration of former president Mahinda Rajapaksa, who had faced criticism domestically for too heavy a reliance on Chinese investment.
Faced with falling foreign reserves, Sri Lanka’s new administration under President Maithripala Sirisena, is hoping to boost investment from abroad.
Wang Dehua, a professor of South Asian studies at the Shanghai Institute for International Strategic Studies, said China would consider the equity swap.
http://www.scmp.com/news/china/diplomacy-defence/article/1935065/all-weather-friends-china-sri-lanka-agree-resume
“It allows Chinese companies to have a stake in Sri Lankan companies,” he said. “China is willing to consider different financing options for Sri Lanka.”
Srikanth Kondapalli, who teaches Chinese Studies at New Delhi’s Jawaharlal Nehru University, said despite pledges to resume the project, Colombo would not be as “desperate” as before to engage Beijing. He noted protests over Chinese investment and Sri Lanka’s push to engage countries such as Japan and India.
He said Colombo would not “put all its eggs in one basket”, and was still concerned that China would rely on its own workers for joint projects, meaning there would be no transfer of skills.
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