China, on Thursday, hit out at “debt trap” allegations linked to Sri Lanka saying the allegation is being used to obstruct China’s development and also prevent the development of other countries, like Sri Lanka.
At a meeting with a select few journalists, the Chinese Embassy in Colombo said that the “debt trap” is a false term and is being used to maintain the Western world’s traditional superior position in the international and regional politics and economics.
A spokesperson of the Chinese Embassy said that China will continue to provide selfless support including much-needed funds for the development of Sri Lanka.
A statement issued at the meeting with the journalists quoted an Embassy spokerperson as saying that China would like to work together with the Sri Lankan Government, business community, media and the general public to eliminate interference, strengthen confidence, and jointly promote the pragmatic cooperation for the benefit of the two countries and the two peoples.
“The Chinese projects in Sri Lanka adhere to the golden rules of extensive consultation, joint contribution and shared benefits. Most of the major projects related to the national economy and people’s livelihood such as ports, roads, airports, power stations, and water conservancy. They are based on the urgent needs of the economic and social development of Sri Lanka, and proposed by the successive Governments on the basis of sufficient feasibility studies. However, Sri Lanka itself lacks relevant funds, experience and technicians to meet the difficulties of large capital requirements, low returns, high risks, long return times, and high technical thresholds of these projects. As a result, Sri Lanka turns to request cooperation from the international community including China,” the statement said.
The Embassy also said that the construction of the Hambantota Port in the south of the country and the transfer of the operations of the port was proposed by the Sri Lankan Government to China and finally agreed on through rounds of friendly and equal commercial negotiations.
“The purpose was to fully exploit the geographical advantages of Hambantota, improve operational efficiency and revitalize good assets, so as to further develop the port economy of Sri Lanka. At present, the port business is operated by Sino-Sri Lankan joint ventures, the port revenue is shared by both sides, and the port security is entirely under the responsibility of the Sri Lankan Government. The so-called Chinese taking advantage of the debt for its hidden agenda and other attempts are simply untenable,” the Embassy said.
Meanwhile, China Harbour Engineering Company (CHEC), which was accused of giving money to former President Mahinda Rajapaksa to fund his campaign at the 2015 Presidential elections, said that it has never been involved in the internal affairs of Sri Lanka.
A New York Times article published on June 26 detailed how Rajapaksa had taken on more than $1 billion in loans from China’s Government to build the Hambantota port despite feasibility studies that concluded the project was not economically viable.
CHEC said the construction of the Hambantota Port by CHEC was an important national task based on mutual agreement between Sri Lanka and China Governments, and was implemented under a transparent model.
“CHEC has never been involved in the internal affairs of Sri Lanka. The Hambantota Port was built for the Sri Lankan Government and its people. We wish to jointly safeguard Sri Lanka’s investor friendly environment. The relevant media report has distorted the facts and provided a false opinion,” CHEC said.
CHEC also said that China was approached to build the Hambantota Port after India had turned down the offer from Sri Lanka.
“According to our knowledge and based on official statements released by Government officials, Sri Lanka was expecting India to assist in the development of the Hambantota Port. However, after India’s lack of interest, Sri Lanka approached China for assistance. Considering the traditional friendship and long-standing relationship with Sri Lanka, China decided to offer selfless support in Sri Lanka’s national development initiative to construct the Hambantota Port. China also provided financial assistance at the request of Sri Lanka including a large sum as a concessional loan. Therefore, it is evident that China never coerced Sri Lanka to construct the Port and nor did China lure Sri Lanka in to any debt trap,” CHEC said.