“We could expect a new high in China-SL economic cooperation”: China’s Hu Wei

Senior Chinese leader and top foreign policy official Yang Jiechi with President Gotabaya Rajapaksa in Colombo 

Acting Ambassador of China to Sri Lanka Hu Wei in this interview talks about the outcomes of the recent visit of the ‘high-powered Chinese delegation’ led by senior Chinese leader and top foreign policy official Yang Jiechi, who is a member of the Communist Party of China’s Politburo and the Director of the Central Committee’s Foreign Affairs Commission, the top policy-making body. The visit was made possible by a travel bubble created for the purpose and strict adherence to COVID-19 protocols. Following are excerpts of the interview:

By Dinesh Weerakkody

Q: Recently a powerful Chinese delegation led by Communist Party of China Politburo member Yang Jiechi met President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa in Colombo. What was the outcome? 

The two sides had an in-depth exchange of views on further strengthening bilateral relations,

mutually supporting each other in the international arena, jointly fighting against the COVID-19 pandemic and reviving trade and investment in the post-COVID era, etc. The leaders reached consensus on bilateral collaboration in many fields. This included a grant of RMB 600 million ($ 90 million) by the Chinese Government to Sri Lanka. The rest of the projects agreed will be implemented one after the other, bringing visible benefits to the public very soon.

Q: According to analysts this is the first-ever Chinese visit in the South Asian region since the global coronavirus epidemic. Does this signify a significant revival of economic relations with Colombo?

It is indeed the first-ever visit of Chinese leader to this region after the COVID-19 outbreak. China always attaches great importance to its bilateral relations with Sri Lanka. The strategic partnership between the two countries goes far beyond the economic realm. After this visit, there is no doubt the investment and commercial cooperation between our two countries will be further strengthened. 

Currently, a dozen joint projects are progressing smoothly, with flagship projects such as the Colombo Port City and Hambantota Port and Industrial Park set to achieve visible progress soon. We could expect a new high in China-Sri Lanka economic cooperation.

Q: China is already one of the biggest investors in various infrastructure projects in Sri Lanka. What more is in store post 2020?

 China and many other countries have learned from their own experience that infrastructure construction is the essential foundation of a nation’s development. Since the independence of Sri Lanka, China has had the honour of participating in the construction of the island’s first expressway, railways, the biggest water conservancy project and biggest power station, which contribute greatly to Sri Lanka’s economic development and to improve the livelihoods of the people. 

Currently Chinese companies are actively participating in the island’s construction industry, including new energy, hydro-power, and the Central Expressway, etc. The Chinese side is also willing to help with other infrastructure construction projects at the request of Sri Lanka.

Q: What are some of the challenges faced by Chinese investors in Colombo?

: I think the main challenge is to create a friendlier environment for foreign investors, as some Chinese companies have been encountering difficulties such as bureaucracy, inefficiency and inconsistency of policies. As all the economies in the world have been badly hit by the COVID-19 pandemic, there is now fierce competition between different countries to attract good investors. To win this competition, Sri Lanka has to show a more convenient, more business friendly and a more favourable investment climate to foreign investors. Start with those operating in the country. 

In the past few decades, China has gained a lot of experience in attracting foreign investment from our successful practices back at home. China is the second-largest recipient of Foreign Direct Investment in the world. It will be a pleasure for us to share these experiences with our Sri Lankan friends.

Q: When do you think China will open up for exhibitions and for business?

 Despite the fight against pandemic, China has gradually resumed its economic and trade contacts with the outside world, and people-to-people exchanges have also increased at a steady pace under the health guidelines of COVID-19 prevention and control. 

Currently some exhibition activities have already taken place and the third China International Import Expo (CIIE) will be held in Shanghai in November. Although there will be some changes for the exhibitors participating in the event this year, the exotic and exquisite Sri Lankan products will surely generate a lot of interest with our people.

Q: What is the current status in vaccine development by China and the potential for commercialisation? 

 China is now leading the development for coronavirus vaccines as 11 Chinese vaccines have entered the clinical trial stage and four of them are in the third phase. To better ensure global equitable access to COVID-19 vaccines, China has recently joined COVAX, convened by CEPI GAVI and WHO, and will provide support for Sri Lanka and other developing countries in need. This was reiterated by the Chinese leader to the Sri Lankan leaders during the recent visit.

Q: Is there a strategy in place to increase two-way trade between Sri Lanka and China?

 During the visit, the two sides have agreed that the FTA negotiation should be resumed at an appropriate time and early. The next meeting of the Joint Committee for Economic and Trade Cooperation should also be scheduled in order to guide and stimulate our bilateral trade through this governmental framework.

In a market economy, while the government provides guidance and creates an enabling environment, the key role should always be played by private enterprise. We fully understand the concerns of Sri Lanka to increase its exports to the Chinese market and we are committed to provide more assistance for it. But I would like to emphasise that more effort by Sri Lankan enterprises and chambers are a must to develop their own contacts and markets in China for their product and services. We stand ready to support your chambers and companies to expand into China.