China-Sri Lanka economic ties to enter golden era

Monday, 15 September 2014 00:41 - - {{hitsCtrl.values.hits}}

Xinhua: Booming economic and trade relations between China and Sri Lanka are expected to enter a golden era, as the latter is an important participant and major beneficiary of the 21st Century Maritime Silk Road initiative. The two nations are anticipating more cooperation and closer ties in trade and economy with the upcoming Sri Lanka visit by Chinese President Xi Jinping, who proposed the initiative of the 21st Century Maritime Silk Road last year.

For the Indian Ocean island country that connects sea routes of Asia, Africa and Europe, China has emerged as the largest foreign direct investor, accounting for one fourth of the inflows in 2013, according to Minister of Investment Promotion Lakshman Abeywardena. Loans and investments from China have played a significant role in Sri Lanka’s post-war reconstruction, Abeywardena said in an interview with Xinhua on the eve of Chinese President Xi’s visit. Direct investment from China is not only contributing to foreign exchange reserve and job creation of the country, but also generating considerable benefits through technology transfer and development, he said. The Minister said projects of 14 Chinese companies registered at the Board of Investment of Sri Lanka have generated more than 2,500 local jobs. In Sri Lanka, a number of large projects funded by Chinese enterprises are under construction, as President Mahinda Rajapaksa has put much effort in turning the nation into a global maritime logistics centre and a world-class harbour and goods distribution centre. Chinese enterprises have undertaken construction of mega infrastructure projects in Sri Lanka, like the Hambantota Port and Colombo South Harbour, which are likely to change the dynamics of the Sri Lankan economy and boost its future development. During Xi’s visit, the construction of Norochcholai Coal Power Plant, carried out by China Machinery Engineering Corporation, will be completed after eight years of joint work. The project is expected to meet 45% of the total demand of the nation’s power grid. The 21st Maritime Silk Road initiative is expected to attract more foreign investment, especially the Chinese investment, to Sri Lanka, said Abeywardena. He also noted that Sri Lanka hoped the proposed Sri Lanka-China Free Trade Agreement (FTA) would help Sri Lanka to gain easier access to the Chinese market and gradually reduce its trade deficit towards the world’s second largest economy. A joint feasibility study on the proposed Sri Lanka-China Free Trade Agreement (FTA) completed in March 2014 concluded that the building of an FTA would bring benefits to both countries. At a briefing on President Xi’s upcoming visit to three South Asian countries of Maldives, Sri Lanka and India from 14 to 19 September, China’s Assistant Foreign Minister Liu Jianchao said China’s relations with Sri Lanka have been healthy and stable since the two established diplomatic ties 57 years ago. China-Sri Lanka relations have become an example of friendly coexistence and mutually-beneficial cooperation between large and small countries, he said. Over the years, the two countries have maintained frequent exchange of visit by high-level officials, continuously deepened practical cooperation in trade, investment and infrastructure development and expanded cultural and people-to-people exchanges, he added. China has become Sri Lanka’s second largest trade partner and the second largest sources of imports to Sri Lanka. In 2013, bilateral trade reached $ 3.62 billion, and China became Sri Lanka’s largest investor, statistics from Sri Lanka showed. Asanga Abeyagoonasekera, Executive Director of the Lakshman Kadirgamar Institute of International Relations and Strategic Studies, said the 21st Century Maritime Silk Road initiative has provided favourable opportunities for China and Sri Lanka to further enhance ties. Abeyagoonasekera said he believes that Sri Lanka can play a major role in the development of the Maritime Silk Road, and the nation is highly expecting Xi’s visit, during which more cooperation agreements are likely to be inked to benefit both nations.

China-Sri Lanka ties ushered into new stage: Ambassador

Xinhua: Chinese President Xi Jinping’s scheduled visit to Sri Lanka would be a milestone for the bilateral ties, Chinese Ambassador to Sri Lanka Wu Jianghao has said. The Ambassador told Xinhua in an exclusive interview that Xi’s visit would be the first of Chinese President and it would set up a guideline and a blueprint for the future of the bilateral ties. Wu said the two sides upgraded their ties to strategic cooperation partnership in May last year during President Mahinda Rajapaksa’s tour in China.

He said the two nations have a history of friendly relations and in recent years, the two have seen massive cooperation projects. The two countries have built high mutual trust in the world political arena, firmly backing each other on issues of core interests, said the Ambassador. He said since Sri Lanka ended the three-decade long conflict in 2009, Chinese enterprises have been storming into the island nation and statistics in sectors of trade, investment, infrastructure and tourism have seen a blossoming surge. President Xi’s visit is expected to further enhance Sino-Sri Lankan relations, said the Chinese ambassador. A Free Trade Agreement (FTA) dialogue between the two countries is expected to start during Xi’s visit. The Chinese Ambassador said the FTA is predicted to bring about overall positive impact, further enhancing investment and people to people exchange. Wu said China has worked out a framework of 21st Maritime Silk Route, which harmonises with Sri Lanka’s development. The island nation was the first country to express its support to the Silk Route initiative. The two sides are panning out schemes under the framework for substantial outcomes, said the Ambassador.