Machang. China as Sri Lanka’s Best Friend

Don Manu in Sunday Island, 18 February 2018



Even as the Chinese New Year of the Dog dawned this Friday, it is becoming crystal clear that China is fast turning out to be Lanka’s best friend.. And that this country, reduced as it is to the nadir of its economical and political existence and the recent loss of its moral compass, should grip the hand of friendship. China, for whatever reason, has so earnestly extended to her. If last week’s election result showed the political negative Yin of Chinese philosophy, it has become vital that the nation embrace the positive Yang on the economic front and anchor its last buck and its first faith to the growing power of the Chinese Yuan.

Lanka should face the reality to clutch not the straw other nations have thrown to save her from drowning but to step on the sturdy branch China has laid out on a red carpet of welcome for her to climb aboard her cruise ship and embark with her, along with a host of sixty other nations, upon a voyage of discovery to find untold riches on the ancient silk route China once dominated two thousand years ago and wishes to dominate again in the 21st century. Thankfully the present government jumped aboard last year or else Lanka would have missed the boat. Without another vessel in sight to raise the thumb and hitch a sail boat ride on the great Chinese Odyssey. A voyage to lead Lanka and over sixty other countries, from poverty to affluence with Captain China on the ship’s bridge with hands firmly fixed on the wheel. But, at least, for the moment, Lanka is dining at the Captain’s table.

For this island nation is so geographically placed, the midpoint between the east and the west, between Beijing and Rome, between China and Africa, that she was the hub of the Indian Ocean twenty centuries ago which advantage Lankan kings of old exploited to the full to create the wealth that built the great stupas that rivalled the pyramids of Egypt. They saw it as a gift the gods had brought to their shores; and did not spurn the offering and heaven sent opportunity to enrich their coffers by being the transshipment point of then international trade. It still retains the preeminence. As the natural port of call for ships to break voyage between East Asia, Europe and Africa to either unload goods for transshipment or to refuel and steam ahead to other ports of destination.

Over two thousand years ago China’s imperial envoy Zhang Qian who represented the Han Dynasty mapped a network of trade routes that linked China to Central Asia and the Arab world. China’s most important export then gave the route its name: Silk.

The Silk Road consisted of several routes, the northern route which travelled through mountain ranges, the southern route or Karakoram route was mainly a single route running from China through the Karakoram mountains connecting Pakistan and China, The southwestern route is believed to be the Ganges Brahmaputra Delta, which has been the subject of international interest for over two millennia. And of course there was the old maritime route which placed Lanka at the epicentre of the Silk Route’s chartered course as it traversed the seven seas. The South China Sea, Strait of Malacca, Indian Ocean, Gulf of Bengal, Arabian Sea, Persian Gulf and the Red Sea.

But despite whatever British poet Rudyard Kipling meant when he wrote, ‘East is East and West is West and the twain shall never meet,” East met West in the isle of Lanka. In the harbour of Hambantota. The hub of the silk route.

CHINESE NEW YEAR OF THE DOG: Will it be a ruff year or will it woof economic boom for Lanka?









But a series of events which ruffled the waters saw the route’s decline. Environmental crises and cycles of climate change in the 14th century forced both China and West Asia to turn inwards. Drought and famine accompanied by plagues of locusts on Yuan China from 1324 to 1330, and again from 1339. Concurrently, another plague pandemic, which killed an estimated 30 percent or more of Europe’s population in a ‘Black Death’ and spread to West Asia slumped trade on the Maritime Silk Road. But though Black Death may have knelled the bell of death to the silk route, China’s dream did not die with it. She, with a five thousand history behind her, stayed patient until the time was ripe to revive it and re-live the ancient dream.

With the slothful panda as her mascot, China lulled the west into blissful complacency, until she was ready to bring out the dragon in her to the world’s amazement. It happened in 1993. Within two decades total trade multiplied by nearly 100 to USD 4.2 trillion to challenge the United States as the world’s biggest trading nation. She was ready to take on the world. The sleeping giant had finally awoken.

Five years ago, China’s president, Xi Jinping, proposed to reestablish the ancient Silk Road. And in the case of the maritime route, the ancient port of Hambantota re-assumed its indispensability as the hub of the grand plan, as it had done two thousand years ago.

But even before he announced it, the ground had already been furrowed and plowed with the seeds planted to see China’s own 1500 year old Big Banyan Tree with a seven-metre girth at its trunk dwarf the Lankan Nuga.

The year 2000 to 2001 January was the Chinese Year of the Dragon. A year later, it moved the then Prime Minister Ranil Wickremesinghe to unveil the “Regaining Sri Lanka” concept which identified the ancient seaport of Hambantota for development. But with his fall from Chandrika’s grace, it was shelved for another six years when the Rajapaksa regime wiped the dust off the project file’s and claimed paternity to the vision to restore Hambantota to its old glory. And the Chinese were ready with the money to make the dream come true.

The total cost of the first phase of the project was estimated at $360 million, excluding $76.5 million for the bunker terminal. Eighty five percent would be funded by China, the balance by the Sri Lanka Ports Authority. The Rajapaksa regime, to their credit, saw the project through but, with their fall in 2015, it was left to the Sirisena-Wickremesinghe administration to wag the tail.

The development of the port had been completed but the nation sat on the dock of the Hambantota bay waiting for the ships to roll in and to watch them roll out again but none did., even though the port was just 10 nautical miles from one of the world’s busiest shipping routes. Lanka had the goods but not the salesmanship to market its wares, to exploit the potential of its port. Obviously, a strategic partner was called for. And China to whom Lanka owed a thumping 8 billion US dollars came to the rescue. What was proposed was to swap part of the debt for equity. To sell the port to a Chinese company on a 99-year lease.

HAMBANTOTA PORT: The hub of southern development

To some it seemed Lanka had become the fly caught in the Chinese web of the debt trap. To neighbouring India it appeared as a direct threat to her own security and the bogey of China establishing a naval base was put forward in a bid to scuttle the venture. But whereas the Rajapaksa regime had tilted exclusively toward China and snubbed India much to her ire, the new Sirisena-Wickremesinghe regimen managed, through adroit diplomacy, to calm India’s fears and simultaneously satisfy debt repayment to the Chinese. And furthermore herald a new miracle in Lanka’s Deep South, an area that had for years been subject to abject neglect by successive governments.

What China was offering was the full option total package. And it was not an offer that could be refused. Lanka did not have the resources, the money, the expertise, the experience to exploit to the full the huge potential of the Hambantota port.

With China as a strategic partner, Hambantota was Lanka’s oyster waiting to be cracked open to find within its shell, the pearl of her future promise, For starters, on July 29, 2017,the Concession Agreement about Hambantota Port was signed between Sri Lanka Ports Authority and China Merchant Port Holdings with the investment up to USD 974 million on a 99-year lease. Under the agreement the Chinese company would hold 85 percent of the shares of Hambantota International Port Group. On December 9 last year, the port was handed over to the China Merchant Ports Holdings and the Sri Lanka Ports Authority. What had remained stagnant waters even after its development in 2008 suddenly showed the first signs of ripples.

As the Prime Minister Ranil Wickremesinghe said that day Sri Lanka had joined China’s Belt and Road Initiative with the launch of operations at the Hambantota Port through a joint venture between China and Sri Lanka. He said: “Today we have made arrangements for the management and long-term success of the Hambantota Port. This Sri Lankan and Chinese joint venture, which has taken over the management of this port, and its operations, will ensure an additional port in the Indian Ocean. The Hambantota Port will add to Sri Lanka’s concept of transforming into a hub in the Indian Ocean.”

Some in the opposition claimed that it was selling a national asset. But aren’t they wrong on two counts? First the port has only been given on a 99-year lease. Does one expect foreign investors, be they Chinese or Americans or Indians to come and invest in this country for love, without a legal claim to even a temporary lease of the land? Secondly, what’s the point in refusing to lease out the land, if we do not have the wherewithal to make the best use of it? Beggars can’t be choosers.
Just consider the benefits the new partnership will bring. What have been idle waters for so long have suddenly started to bubble with activity in the wake of ships rolling in, not even two months after the official handover. As much as Lanka would have preferred to be at the helm of affairs and claim all credit and financial return, the stubborn truth remains that force of circumstances have made us outsource the resources we have for at least a slice of the cake. Something better than nothing — especially for a nation with a massive debt burden to service each year.

The mutual aim of both Sri Lanka and China is to turn the Hambantota port into a major hub connecting neighbouring countries as well as the rest of the world. As Prime Minister Wickremesinghe said at the official launching of the joint venture, “We have made arrangements for the management and long-term success of Hambantota Port. The operations of the joint venture will ensure an additional port in the Indian Ocean.”

Today, according to news reports, Hambantota Port is prospering every day and gains increasing confidence from the Sri Lankan community. Senior fellow from the Institute of National Security Studies of Sri Lanka Lasantha Wickremesooriya told foreign news agencies that for the flow of vessels between the West and the East, the major transshipment hub is Singapore. But he added that Hambantota Port is more economical for them. “With the technical know-how, marketing know-how, and the investment capability by CMPH, the port will eventually turn into a profitable venture in the future with more modern vessels coming in,” he said. Mangala P.B. Yapa, managing director of the Agency for Development of the Sri Lankan Ministry of Development Strategies and International Trade, also expects a bright future for Hambantota Port. “We are confident that this collaboration and partnership will bring in success to Sri Lanka and our partner CMPH. A commercially viable and efficient Hambantota Port will be catalytic in the economic development of the south of the country and resulting in better livelihood for the people in that part.”

Exactly. Hambantota port is not a stand-alone venture. It has become the hub of southern development. Around it bloom the blossoming of the entire province.
Consider the following; Twelve miles away from Hambantota, lies the construction site of the fourth section of Sri Lanka’s Southern Highway Extension Project where both Lankan and Chinese workers are engaged in building the last lap of the southern highway. From Matara to Hambantota, the Southern Highway Extension Project is divided into four sections, all contracted to Chinese companies and it is expected to be done end of next year. The Expressway will benefit the local communities as it will ease the movement of goods. The expressway will also help vendors along it to transfer their goods to Colombo within a short period of time and this will improve their livelihoods.

And that’s not all. China and Sri Lanka are also eyeing cooperation on the Industrial and Logistics Zone in Hambantota. According to the proposal, the Sri Lanka-China Industrial and Logistics Zone, covering an area of 50 square kilometres, will not only provide basic shipping services, but also embark on port-related industries, such as refining and sea-product processing industries.

As Ranil Wickremesinghe said, “with the development of the Hambantota Port, steps were also being taken to construct an economic zone in Hambantota which would see hundreds of foreign investors launching factories within this zone in the near future. And this will definitely help strengthen our economy.” The Chinese company that took the port on a 99-year lease had this to say: “the Hambantota Port will be the largest multi-purpose port in Sri Lanka and also the island nation’s single largest private investment. The aim of the government of Sri Lanka and the China Merchant Port Holdings is to transform Hambantota port from a “transshipment hub” to a “total logistics hub” of the Indian Ocean region.”

With the fall of the Rajapaksa regime in 2015, the new Sirisena government expected much from the west. But apart from the praise that flowed, apart from Lanka being granted its place again as a member of the civilised nations of the world and apart from the president flattered by being given a seat at the high table to dine with Obama at a G7 feast, nothing substantial to build the economy flowed. And the government was compelled to look east again — to China for aid even as the previous government had done for the last ten years. If not for China’s helping hand this last decade, the country’s infrastructure would have remained potholed and dilapidated.

The nation expected the world to come to its doorstep bearing gifts to build the economy forgetting that friendship between nations are based solely on self interest and not on love and air. Only China’s ship sailed into port laden with massive investment. Whatever the hire purchase terms may have been, whatever the buy-now-pay-later policy may have entailed, without China’s ever ready cash, Lanka would have been dead broke and in ramshackle condition, forced to eat her supposed sovereignty for mental sustenance whilst the belly remains empty and bare.

Today whilst a port city is arising on Colombo’s shores promising massive investments in the near future and thousands of jobs, the greening of Lanka’s south, long arid of investment has begun. And Hambantota port has become the hub of southern development. Last year saw the foundation stone of the Sri Lanka-China Industrial Zone being laid in Hambantota, with the vision of further developing Hambantota gradually becoming a reality.

China’s aim is to turn the Hambantota port into a major hub connecting neighbouring countries as well as the rest of the world. The Port serves as a hub of cooperation between Sri Lanka and China in Hambantota. The Southern Highway will provide essential infrastructure support for the vast Industrial and Logistics Zone soon to materialise. China may indeed have her long-term strategic reasons to develop the south even as India may have in her attempts to develop the north. Even as the British had during their 150 year rule in the island. Lanka’s only option is to temporarily swallow its pride and allow both to compete with each other and await to reap the economic benefits that will undoubtedly flow from such investments. It’s time to face reality. Realise that size does matter. That money is muscle. Time to brutally accept the position of this island in a geopolitical world; time to accept that we are nothing more than a sprat in a sea of sharks and killer whales. That there can be no real independence to shout about or celebrate each year if the nation is not financially sound.

Lanka, given her geographical position, has the tremendous opportunity to become the hub of the Indian Ocean, even as she once was during the kings of old. But it is also clear that she cannot, given her financial position, do it alone. She needs all the help she can get from the outside world to regain that position and to reap its benefits. And should be glad that the region’s giant and the world’s emerging superpower China – for reasons of her own – is doing it for her. There is nothing called a free lunch. And Lanka cannot have the cake and eat it either.

When the unsolicited project to build a port city right on the capital’s shore was first mooted and then approved by the Rajapaksa regime, the people clamoured against it claiming it would lead to loss of sovereignty. The then opposition raised the issue of granting China freehold land upon it. But when the coalition government came to power, it had no option but to accept the a Chinese port city arising from Lanka’s territorial waters subject, of course, to the freehold being turned to a 99-year lease. Lanka had become the fly caught in the Chinese web of the debt trap. The joint opposition, which had first promoted it as Lanka’s port city of hope, began then to attack the new agreement as a sellout of Lanka’s sovereignty.

But do the people of this country know much about the concept of sovereignty? Except to parrot what the politicians tell them at different times to further their own political interests? Do they realise the value of fundamental rights and its importance as the lifeblood of the nation or do they simply wear its fancy dress politicians adorn them with and shove the motley back to the closet after the voting has been done? To keep it mothballed till another election comes their way?

Perhaps some things can never be taught to a nation on the poverty belt with short-term memory. Even as the Buddha said, ‘never preach to those with an empty stomach, but first feed and then preach,’ the voter buffaloes of Lanka must first be fed its poonac before the principles of sovereignty and the awesome benefits of democracy are extolled and expounded to them.

And take into account the fickle nature of its people — ever vacillating, ever changing, more rapidly than a weather cock revolves on a church spire to changing winds that blow. In such a setup can this nation afford anymore to adopt the arrogance of a poor church mouse and roar? Even as China is slowly lifting its bamboo curtain, it is time for Lanka to raise the veil of hypocrisy with which it had shrouded itself since February 4, 1948. And shed her illusion that the world owes her a living.

Leave a comment

Filed under american imperialism, authoritarian regimes, British imperialism, Buddhism, centre-periphery relations, charitable outreach, China and Chinese influences, commoditification, export issues, foreign policy, governance, historical interpretation, Indian Ocean politics, island economy, landscape wondrous, modernity & modernization, patriotism, power politics, security, self-reflexivity, slanted reportage, sri lankan society, taking the piss, the imaginary and the real, transport and communications, welfare & philanthophy, world events & processes

Leave a Reply