Extricating ourselves from ‘China’s grip’ – a response

Let me thank S.A.K. for his above captioned letter, giving me the opportunity to expose some of his arguments, which show he has not read several of my letters and those by others on the subject.

He mentions an unnamed African Research Assistant. If he had read my letter titled, ‘Chinese lending vis-a-vis International lending agencies, wherein I have mentioned the name of the Senior Research Assistant as Ted Bauman at Banyan Hill, and quoted from Forbes.

SAK asks what is wrong in a Chinese state-owned company lending funds. There is nothing wrong, but the underlying intent of gaining a foothold in the affairs of a country, when the borrowing country fails to repay with interest, as seen in Kenya, which is said to run the risk of losing Mombasa Port in case of default of USD 2.2 billion for the construction of a railway track from Mombasa to Nairobi. Zambia had surrendered its national airport to China as it failed to pay back a loan.

SAK says: “The choice of capital projects, their study and formulation are always the function of the recipient country. The investor comes into the picture only after that. Unless Sri Lankans are a set of idiots who cannot decide by themselves on what to do about economic development of the country, that work will not be entrusted to a prospective investor. If so, accusing China of deliberately choosing financially non-viable projects to fund is highly untenable. If someone has to take the blame for choosing a financially non-viable project. It is the recipient country which is to take the blame.” It is here that our politicians, without consulting independent experts, get their so-called ‘consultants’ to make financial provisions. I have mentioned some such projects in my letters. Let me include the latest – The Tissa Wewa dredging project, where Chinese have been given the contract, whereas this work was legitimately done annually by the Irrigation Department. Worse, the Chinese employ their own labour, materials and machinery, thus taking away the entire loan by paying themselves, and leaving us to pay it back with interest. I agree with SAK when he says, ‘When Sri Lankans are IDIOTS.

The question is why SAK refers to an unnamed African Research Assistant, while hiding behind with initials, without revealing his own name. He mentions major projects financed by foreign governments, Mahaweli, Parliament, even BMICH from China were outright gifts not loans, and no debt traps.

If the state [SL Govt] is corrupt and there is no oversight, China walks in. Chinese projects in Rajapaksa home base – Hambantota -Airport; Port City, Nelum Kuluna in Colombo, are all vanity projects without any benefits to Sri Lanka. The only project of any use is highway construction. Highways are essential, but we have to take into account the cost factor, the quality of work and the fact that the Chinese use their materials and machinery, pay themselves with the loan and make us pay the loan with interest.

I have mentioned the practices followed by International lending organizations, such as the World Bank, the IMF, the ADB and, the JAICA, where they conduct independent feasibility studies and recommend certain measures to be adopted, to make the project viable and to ensure that the borrowing country could pay their loans back. These conditions are not acceptable to crafty politicians for obvious reasons. By funding projects which are not financially viable, China makes such countries poorer.

SAK accuses those who are opposed to questionable Chinese funding of having Sinophobia, but I would call them true sons of Lanka, patriots and not traitors. The clergy, of all religions and eminent economists have raised alarm over Chinese intervention and influence over our internal matters, nearly making Sri Lanka a colony under China.

G. A. D. SIRIMAL

Boralesgamuwa