Sri Lanka backs China's maritime 'Silk Road' plan

AP News
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Posted: Sep 16, 2014 12:46 PM
Sri Lanka backs China's maritime 'Silk Road' plan

COLOMBO, Sri Lanka (AP) — Chinese President Xi Jinping won Sri Lanka's support Tuesday for a proposed maritime "Silk Road" linking China with Europe, and helped launch billion-dollar power plant and port city projects funded by his government.

Xi, the first Chinese leader to visit Sri Lanka in 28 years, and President Mahinda Rajapaksa oversaw the signing of 27 agreements in areas, including highways and the construction of a joint coastal and marine research center. They also agreed to start negotiations on a free trade agreement.

Xi is visiting countries in South Asia this week to seek closer relations and support for his vision of a modern "Silk Road" sea route between China and Europe.

"We both believe we have to make use of the opportunity brought about by the 21st century maritime Silk Road to strengthen our cooperation in such areas as port construction and development, development of coastal industrial parks, maritime economy and maritime security," Xi told a signing ceremony.

Earlier Chinese investment in the southern port of Hambantota led many to speculate that Sri Lanka is meant to be a key stop along the maritime Silk Road.

On Monday, Xi secured backing for the plan from the nearby archipelago nation of the Maldives.

The ancient Silk Road was a series of overland routes that linked China with the Mediterranean Sea, opening the way for economic, political and cultural interchange.

Before departing for India on Wednesday, Xi planned to help launch Colombo Port City, being constructed on an artificial island off Colombo with $1.4 billion in Chinese loans, according to the builder, China Communications Construction Co. Ltd.

The company said the port city will be a "hub on the marine Silk Road of Asia and position itself as the preferred global tourism destination in Asia."

Rajapaksa said the port city would be the single largest development project in the country's history with the potential to attract $5 billion in investments.

Xi and Rajapaksa also launched the final phase of a 900 megawatt coal power plant valued at more than $1.3 billion.

Rajapaksa said the plant will help make electricity available for every Sri Lankan household, and announced a 25 percent reduction in electricity fees.

China has become Sri Lanka's largest lender in recent years, providing more than $6 billion through September 2013 for port facilities, highways and a new international airport.

Two-way trade totaled more than $3 billion last year, a 368 percent increase since Rajapaksa came to power in 2005. Seventeen percent of Sri Lanka's total imports are from China.

China also supplied weapons to the government during Sri Lanka's 27-year civil war that ended in 2009 with the defeat of ethnic Tamil separatists, and has defended the Indian Ocean island nation from allegations of human rights abuses and calls for a U.N. investigation into alleged war crimes. Xi reiterated that backing on Tuesday.

"China firmly supports Sri Lanka in choosing a development path suited to its national conditions ... and resolutely opposes any move by any country to interfere in Sri Lanka's internal affairs under any excuse," Xi said in an article that appeared in the state-run Daily News.

However critics say Sri Lanka-China deals are a debt trap shrouded in secrecy, with most projects unsolicited and leaving way for corruption.

"China's role in modern Sri Lanka is not without controversy," independent Sunday Times newspaper wrote in an editorial ahead of Xi's visit.

"The secrecy, the swiftness and the economy with facts and figures in its financial dealings with the Rajapaksa government fuel conspiracy theories and genuine fears alike, that, to put it mildly, Sri Lanka is in China's pocket," it read.

"The people are clueless. Both governments seem to operate on the principle that what people do not know will not hurt them. Either that or there is too much to hide."