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Saturday, 8 November 2014 00:00 - - {{hitsCtrl.values.hits}}
China’s 21st Century Maritime Silk Route (MSR) policy received enthusiastic approval from Central Bank Governor Ajith Nivard Cabraal yesterday as it has strong resonance with Sri Lanka’s five hub aspirations.
China’s MSR has strong connections to President Mahinda Rajapaksa’s economic policy framework that outlines aims to establish a maritime, commercial, knowledge, tourism and energy hub, Cabraal told a gathering he was addressing at the Lakshman Kadirgamar Institute.
The Government’s policy makers have long insisted it was possible to use the island’s strategic location in linking Europe and Africa with Asia. Cabraal pointed out that even though the Government’s policies pre-dated MSR, the benefits to both could be significant.
“Strengthening economic cooperation, joint infrastructure projects, security cooperation, technical and scientific cooperation as well as greater maritime economic engagement will happen. Already Sri Lanka has two international ports and two international airports that can link to MSR,” he noted.
Over 27 agreements including new highways signed during Chinese President Xi Jingping’s historic visit to Sri Lanka in September aims to function as links to MSR and benefit from the economic connectivity it would bring, Cabraal added.
Cabraal went onto say Singapore with one international airport and one mega port has reaped massive economic gains and Sri Lanka stands to double that given its massive infrastructure developments.
The Colombo Port and the Hambantota Port in Sri Lanka’s Deep South already focus on transhipment and relay-shipping. Energy projects are already underway through a $ 1.2 billion coal power plant in the north-western part of the country while another is in the pipeline.
As island nations in the Indian Ocean, the Maldives and Sri Lanka are both crucial to the initiative and also stand to reap benefits from being situated as stops on a larger maritime trade route.
Accordingly, leaders from both countries were enthusiastic about joining the project. Sri Lanka also received $ 1.4 billion from China to build the ‘Colombo Port City,’ part of a bid to mould the island country into a rival to thriving ports in Singapore and Dubai.
Cabraal believes MSR will pave the way for a knowledge hub in Sri Lanka that can focus on maritime law, research and development, fisheries training and training in oil and gas exploration.
Insurance and banking industries, in particular, will get a boost with the Central Bank already singing a currency swap agreement with People’s Bank of China.
The Sri Lankan Government’s Budget for 2015, which is currently being debated in Parliament, also outlines policies to improve skills development, tourism and infrastructure that will tie into MSR, Cabraal assured.
MSR will also be facilitated by the successful launch of Asian Infrastructure Investment Bank in which Sri Lanka along with 20 other countries joined. Chinese President Xi Jinping earlier this month called for accelerating efforts to construct Silk Road Economic Belt, saying that the two are complementary.
Hambantota port poser stirs ParliamentBy Ashwin HemmathagamaParliament heated up yesterday with Opposition lawmakers accusing the Government of entering into an agreement with China which transfers ownership of the Hambantota Port to them for 40 years. During the Committee Stage Debate on the Ministry of Highways, Ports and Shipping of the Budget 2015, UNP MP Niroshan Perera charged that the Government entered into such an agreement on 16 September 2014. “When you entered into this agreement did you keep the Cabinet informed? The agreement was signed when Chinese President Xi Jinping was here in Sri Lanka,” he stated. In response, Highways, Ports and Shipping Deputy Minister Rohitha Abeygunawardena said he would resign from his post immediately if the Opposition could present documentation proving that the Hambantota port was given to China, as claimed by the UNP. |
China’s maritime policy a win-win, says Chinese Ambassador
 China’s 21st Century Maritime Silk Route (MSR) policy does not seek to interfere in internal affairs of countries or otherwise dominate regional issues, China’s Ambassador to Sri Lanka assured here on Friday.
The MSR has caused much curiosity among the international community observed China’s Ambassador to Sri Lanka Wu Jianghao, but he assured it was simply an inclusive platform aiming to combine the rapidly-expanding Chinese economy with the benefits of all countries involved.
“It (MSR) foresees no interference in the internal affairs of the countries involved, nor does it seek to dominate regional affairs or secure spheres of influence in the region,” he told a seminar on MSR organised here.
Five links will take place due to MSR bringing “tangible” benefits to people, he insisted.
The first of these will be a political link that will promote mutual trust such as upgrading Sri Lanka-China relationship to a “strategic partnership”. China would like to strengthen exchanges through high-level visits between the two countries in the future, Wu added.
The second link of connectivity can be seen in massive infrastructure development taking place in Sri Lanka, which is estimated to be over $ 5 billion. During Chinese President Xi Jingping’s visit over 27 new agreements were signed that would also tie into this element.
The Colombo Port City Project is perhaps one of the largest of these at $ 1.4 billion in investment.
Trade is a crucial link tying MSR to countries along Asia and Africa. Negotiations on Sri Lanka’s Free trade Agreement (FTA), which is to be signed next year is one way trade is expected to increase. Currently over $ 3 billion in trade connects the two countries but the trade balance is overwhelmingly in favour of China.
Currency agreements are another connection with Sri Lankan banks allowing transactions in yuan and swap agreements with Chinese banks and Sri Lanka’s Central Bank. Sri Lanka’s founding membership in the Asian Infrastructure Investment Bank is another aspect.
“Chinese tourist arrivals to Sri Lanka have increased by 140% in the first nine months of this year exceeding 100,000. The two sides will make joint efforts to achieve the aim of attracting 250,000 Chinese tourists by 2016. In future China would like to carry out infrastructure projects which cater to Sri Lanka’s strategy to build “five hubs” of maritime, energy, knowledge, commercial and tourism.”
He proposed setting up joint ventures to enhance development of Sri Lanka’s manufacturing and other industries.
“A few days ago President Xi announced China will set up a Silk Road Fund with the aim of directly supporting the construction of Silk Road Economic Belt and the MSR, which demonstrates China’s firm commitment to this initiative,” he said. |
