China pledges in­vest­ments ex­ceed­ing US$ 10 bn to Sri Lanka over next 3 years

Daily Mirror (Sri Lanka) - - BUSINESS NEWS -

China has pledged over US$ 10 billion in in­vest­ments to Sri Lanka over the next 3 years in ad­di­tion to other bilateral in­vest­ments, De­vel­op­ment Strate­gies and In­ter­na­tional Trade State Min­is­ter Su­jeewa Se­nas­inghe said yes­ter­day at the con­clu­sion of the World Ex­port De­vel­op­ment Fo­rum 2016.

“China has com­mit­ted to about US$ 10 billion within about 3 years,” he said in re­sponse to a ques­tion Mir­ror Busi­ness raised.

This rep­re­sents an es­ca­la­tion of Chi­nese in­vest­ment plans, since the Chi­nese Am­bas­sador had last month said that China was will­ing to in­vest US$ 5 billion in a sim­i­lar time frame across in­dus­trial zones that will be cre­ated in the fu­ture in Ham­ban­tota and other re­gions.

In­dia has since said that there would be US$ 2 billion in in­vest­ments over the medium-term, while the United States pledged US$ 792 mil­lion as well.

Se­nas­inghe noted that there are com­mit­ments for mega projects from In­dia, Ja­pan and Thai­land, and said that many smaller in­vest­ments for which val­ues haven’t been calculated have also ma­te­ri­al­ized.

“We have a cou­ple of huge in­vest­ments, es­pe­cially in Ham­ban­tota. There’s an oil re­fin­ery which is worth about US$ 1 billion, there’s a gas re­fin­ery which is worth about US$ 2 billion, and there’s a sugar re­fin­ery, I don’t know the num­bers on that. And a cou­ple of ce­ment fac­to­ries,” he added.

Se­nas­inghe said that there are also two 500 megawatt liq­uid nat­u­ral gas power plants planned for Trin­co­ma­lee and Ham­ban­tota. Sri Lankan ci­ti­zens pres­sured the gov­ern­ment into aban­don­ing the cheaper coal op­tion, and a power cri­sis is loom­ing, start­ing from 2018.

De­vel­op­ing Ham­ban­tota with the as­sis­tance of China had been the brain child of former Pres­i­dent Mahinda Ra­japaksa. The new gov­ern­ment had said that since the white ele­phant projects have al­ready been launched, it is now in­cum­bent upon them to cre­ate re­turns on in­vest­ments.

De­spite the grow­ing ri­valry be­tween In­dia and China, the East Asian Tiger had said that it was not ban­ning In­dia or any other coun­try from set­ting up op­er­a­tions within Chi­nese in­dus­trial zones in Sri Lanka, in­clud­ing in the 15,000-acre zone planned in Ham­ban­tota.

The past in­fra­struc­ture projects were fi­nanced through high in­ter­est debt in­stru­ments in­stead of in­vest­ments based on pub­lic pri­vate part­ner­ships.

Su­jeewa Se­nas­inghe Pic by Nisal Baduge

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