Spats about Ports in Sri Lanka: The Bigger Picture

  Mick Moore**

To the extent that we can make any confident prophesies about world affairs in this very fragile current context, it is reasonable to predict that (a) global political, military, economic and ideological competition between China and the US is going to continue to loom large and (b) Sri Lanka, for a range of historical and geographical reasons, is likely to remain caught up in that competition. We can expect to see many more partisan spats, like those between Jonathan Hillman and Fair Dinkum in relation to the Hambantota Port, counterposing good/wicked China against wicked/good US. Some claims will be right, and some wrong. My guess is that in 10 years or so, the two combatants will earn similar levels of positive and negative points.

What should really matter to Sri Lankans is first that its governments maintain strategic leverage in relation to both powers. They should be neither too close nor too remote from either, and they should hone their bargaining skills. Second, they should use that leverage in the national interest, rather than in the narrow interests of the particular groups that happen to be in power at any moment. It is on this second point I would like to concentrate. I’ll start with a story from another time and place.

Cuba

Remember the 1962 Cuban Missile Crisis? If you don’t remember, online sources can tell you a simple story. The Soviet Union managed secretly to import knocked-down nuclear missile components into the territory of its ally/puppet, Cuba, and began to deploy them. When the American government discovered what was happening, a global crisis quickly followed, and the world came very close to nuclear war between the US and the Soviet Union. The US could not tolerate this threat on its doorstep. President Kennedy ordered a naval blockade of Cuba, and publicly declared that the Soviet Union should remove the missiles, or else….  After a tense day when the first Soviet ship sailing toward Cuba was likely to intercepted by the Americans, Premier Khrushchev backed down. The Soviets vessels turned away. The missiles on Cuba were dismantled. In return, the US removed Soviet-facing missiles it had recently installed in Turkey. Kennedy lived up to his reputation for being tough with the Soviets, and his party did well at the Congressional mid-term elections at the end of the year.

All so dramatic. But significantly wrong, as explained by Theodore Voorhees in The Silent Guns of Two Octobers: Kennedy and Khrushchev Play the Double Game (Michigan University Press. 2020). The placing of nuclear missiles in Cuba did not significantly change the strategic relationship between the Soviet Union and the US. Kennedy knew that, with or without them, any nuclear exchange would result in massive damage to the US. His instinct was to play the Cuba issue down and take little action. But he knew that, once the information about the deployments became public, the Republican Party would be able to use it to do serious electoral damage to Democratic Party in the forthcoming mid-term elections. So, Kennedy had to take the initiative. Publicly, he was confrontational with the Soviet Union. Privately and secretly, cutting out his whole foreign policy and military establishment and most of his own staff, he re-opened an unofficial line of communication with Khrushchev. Khrushchev was not too keen on the whole Cuba adventure. He had authorised it to strengthen his hand in internal Soviet politics. Both leaders were pleased to reach a deal – and indeed Kennedy removed more American missiles from Turkey (and Italy) than the Soviets would have settled for.

The moral of the story? Donald Trump was not greatly out of line in trying to use his personal and direct relationships with the Russian government to strengthen his political hand at home. Political leaders will always tend to do that if they can. They cannot be entirely prevented. But unaccountable political leaders are especially likely to do it in ways that damage their own countries and citizens. And that takes us down to Hambantota.

Hambantota

Let us start with a little ground clearing. It is irrelevant whether Leonard Woolf, D.A. Rajapakse or any other historical character ever suggested expanding the port at Hambantota or somewhere nearby. Until recently, for a combination of technical and economic reasons, the current port structure would have been infeasible and inconceivable. It is a totally new port, carved out by shifting massive amounts of rock and earth, at enormous cost. Sri Lanka has not been short of port facilities. Trincomalee is grossly under-used. In the 1970s especially, the problems in Colombo were not shortage of physical facilities, but poor management. As Hillman points out, there is still scope to expand Colombo’s port facilities, at a much lower unit cost than Hambantota. At the moment, the economic hinterland of the Hambantota Port generates virtually no exports and has rather modest needs for imports. In relation to current needs, the Hambantota Port is a white elephant.

But what has been built does not accord exactly with what was, at least at one point, planned. At least one earlier Chinese proposal – perhaps the main Chinese proposal – was that the port would be an integral part of a much more ambitious regional development project covering a substantial chunk of Ruhuna.[1] Those regional development proposals were dropped,[2] for reasons of “politics” (quote) that remain obscure. It is possible – and we can say no more than that – that the more ambitious Chinese proposal would have made more economic sense in the long term.

So, it is reasonable to assume that at least some people on the Chinese side of the deal had wider concerns, beyond the port itself, about the benefits to Sri Lanka. In a similar vein, the Chinese loans to finance the Hambantota Port were charged at about the commercial or expected rate. There was no financial rip-off.[3] It is also worth mentioning that Hambantota has very little value as a military facility during actual conflict. Ships entering, leaving or in dock would be very vulnerable.

Chinese actors probably can be blamed for participating in a massively expensive project that Sri Lanka does not need at present, and really can’t afford. But they did not impose this project on Sri Lanka. The government chose to play ball with enthusiasm. There are certainly benefits to various Chinese institutions, and to the Sri Lankan political leaders who were responsible. Are there benefits to the Sri Lankan economy and to the average Sri Lankan? Probably not.

The wider moral of the story is that, when we see partisan quarrels about whether China or the US (or India) is a better friend of Sri Lanka, we need to stop and think. Is this a smokescreen for powerful Sri Lankans to do well for themselves by exploiting their relationships with China, the US, India (or the UK, Malaysia, Qatar, the UAE, Germany, ….)? It is safest to assume that overseas governments and companies will rarely approach Sri Lanka with the interests of the country foremost in their minds. We need to be wary of them, and equally wary that national leaders are not stoking disputes among domestic partisans of China and the US (and other countries) for their own malign or self-interested purposes.

**************

A NOTE from Michael Roberts

The highlighting emphases within this article are my imposition. The academic exchanges between Mick and myself go back a long way –to the early 1970s when Mick Moore was attached to the Institute of Development Studies, University of Sussex. Besides numerous articles, Mick has produced at least one book on Sri Lanka –an important one entitled The State and Peasant Politics in Sri Lanka, (CUP, 1985). Do note these descriptions: http://www.sussex.ac.uk/profiles/1868http://www.gsdrc.org/docs/open/ret57.pdf. However, on this issue, I believe he has underestimated both the economic developmental and the tourist potential of the south-eastern quadrant of Sri Lanka. My assessment is guided by three relatively recent visit to that area: as a cricket lover to Sooriyawewa in 2011; as a tourist visiting Buduruvagala, Arugam Bay Kumana and Yala in 2015 and, again, as a tourist visiting Bundala-Tissamaharama-Kirinde-Yala, and thence to Ella, in January 2018.

Mick and the public pursuing this topic will profit from a reading of the article by Christopher Devonshire-Ellis (based in Sri Lanka) entitled “The Real not Secret History of Hambantota” …. At …https://www.silkroadbriefing.com/news/2021/09/06/the-real-not-secret-history-of-hambantota/

END NOTES by Moore

[1] I am grateful to Deborah Brautigam for originally alerting me to this.

[2] I obtained confirmation of this from a very trusted source highly placed in the government policymaking process.

[3] Again, I have this information from a very trusted and senior source, that must unfortunately remain confidential.

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9 responses to “Spats about Ports in Sri Lanka: The Bigger Picture

  1. Fair Dinkum

    Mick Moore’s description of my critique of Hillman’s essay as “a spat”, “being partisan” or seeking to “earn points” is unfair and fallacious because it trivializes and oversimplifies the big picture which I touched on in the final part of my short essay.

    Through the “Strategic Competition Act of 2021” passed by the US Congress, the US is pushing for a major global shift towards a bifurcation of infrastructure (i.e. the Belt road verses the US Build Back Better Road); technology (notably in 5G and artificial intelligence); trade; economics; and security, and all of this (especially infrastructure and technology) are about to impact on all countries across the world. The ramifications of this bifurcation are serious. It is the big challenge of our times – far bigger than the so-called “bigger picture” described by Mick.

    The purpose of the US “Strategic Competition Act” is to pour billions of dollars into a worldwide propaganda campaign, recruiting and training hundreds of journalists to push negative stories across all media outlets, aimed at sabotaging China’s rise. It is also about applying huge pressure on countries to stop, or even dismantle Belt Road infrastructure and 5G technology as we have seen the US attempt to do in Portugal, Greece, Australia, Israel, Czechoslovakia, Malaysia, Sri Lanka, Singapore, and the UK (to name a few countries); cut economic ties with China (which the Australian government is now openly pushing Australian businesses to do through the government’s “China Plus” scheme); so that these countries will be free to sign up to US infrastructure, technology and investment projects. I reject Mick’s description of my essay as a mere partisan spat of “US verses China” aimed at winning points. The issues are far more important than this trivializing rhetoric. This is about the new reality of a bifurcated world system.

    I have always argued Sri Lanka should be neutral and open to dealing with all countries and choose positions (not sides) for each issue, according to its interests. But the dynamic at play here is NOT China and the Hambantota Port; rather it is the US who are imposing their Strategic Competition Act across the world. Mick ignores this important issue which demands urgent attention for all countries. It’s the US that drives the US-China tensions and partisanship, not me. My critique of Hillman’s essay was fair, reasonable, and necessary in the context of our times. It is about opening a debate for all countries to join in, rather than taking sides.

  2. Hambantota is where Hambayas from the Middle East landed those days. That is long before Micks had any interest in it. In modern warfare its location is very valuable to China when it tries to move the Mac Mahon’s line a bit southward and grab the five fingers along the line and may be, chop the chicken neck. Trinco was important in the days of submarines, no more. Talking about local politics India backed Mahinda over Ranil because Third Eye decided Ranil is an unpredictable (hard to negotiate, a brat) man. So it was and he sold it and Third Eye made him pay with a chit MP. Mr. Dinkum; it is not Anglos in the West that drives the Dragon mad. They are the sacred Cattle.

    • Your COMMENTS are rather a rant and full of unuspported insinuations. The pseudonym you have adopted does not help. Have you written an article or a book with appropriate documentation on this sort of topic? WHAT are your credentials? I am considerating the prospect of placing an embargo on your comments

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  4. Edward Upali

    Mick Moore’s piece, comparing the Hambantota Harbour Project by China to the Soviet installation of missiles in Cuba, is not comparable. There is no doubt that a ” trade war” is going on between China and the US, but it is nothing similar to the ‘cold war’ that went on between the US and the Soviets since the late 1940s to 1990.

    However, it is fair to say that every country engaged in trade is looking out to “capture” new markets. American companies receive financial help from US government agencies such as the World Bank, EXIM Bank, IBRD, etc. to sell US goods and services. During the last few decades, largely due to the huge US budget deficits, money available to US exporters has virtually dried up. Meanwhile, China with its huge surpluses, uses it’s money to finance foreign projects to gain goodwill and political advantage. Moreover, China lends it’s money at very low interest rates, which US lending agencies are not willing to match.

    Although, US financing of foreign projects has almost come to a standstill, political arm twisting and propaganda continues. The recent attempt by the US gov to push Sri Lanka to sign the SOFA agreement, giving US armed forces unconditional access to Sri Lankan ports, airports, etc. is a case in point.

    Although the benefits of the Hambantota Harbour, due to its location on the Silk Route and tourist hot spots would perhaps only be realized in the long term, it was a project well worth doing. Sri Lanka could not have undertaken the project with it’s own finances.

    To argue that Sri Lanka has enough port facilities and therefore the Hambantota Harbour was not needed is incorrect. If Lee Kwan Yew of Singapore did not build port facilities and oil refineries beyond the City’s needs, Singapore would still be a sleepy town in the outskirts of Malaysia

    • EMAIL COMMENT from “Fair Dinkum” responding to EDWARD UPALI: “I agree. Excellent observations. It is ludicrous to compare Hambantato with Soviet missiles in Cuba. That was the 1962 Cuban missile crisis which almost led to nuclear war. Hambantato port has never led to nuclear war…. not even in the remotest sense.

      Of course, every country is out to capture new markets, but we know from Clinton’s time, how dirty the US go about it, using intelligence agencies to spy on rival companies to give the US an advantage. The propaganda war is a tool Western governments use to gain advantages to, and that is why Sri Lanka should choose who it partners with on various projects, which is not always China…. NOTE that LEE KUAN YEW turned most of the southern part of Singapore into one huge container port and it is the lifeblood of the city.”

      • True USA private and public institutions do gather intelligence from rivals to their advantage and it is universal. Huawei is a good example and the victim “Alcatel” and others?

    • It is unfortunate we are hooked in with China v USA. We are blinded with fires coming out of the wars between the two assisted by allies of one of them. The other has only non-allies.
      There are real wars between the Indian Union and China; hands, sticks and some times with gun powder at high mountains but not in the blue waters. Really we are caught in between the wars of these two, Dragon and the Sacred Bull bred and reared by the British. The bull is playing havoc with pots in the kitchen.

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