Sri Lanka: China’s Pawn in South Asia

Pranaav Seruwam, Staff Writer (Online)

5 September, 2019

President Mahinda Rajapaksa of Sri Lanka and President Xi Jinping

President Mahinda Rajapaksa of Sri Lanka and President Xi Jinping


 

The dawn of the 21st century ushered economic prosperity of gargantuan proportions for China, a nation looking to gain leverage on the U.S. With a gradual increase in global power, backed up by several investments and technological developments, China was  establishing their status as the sole powerhouse within Asia. However, in their quest to become a global superpower, China realized that their dominance had to expand beyond local borders, and into different corners within Asia. Recognizing that Sri Lanka’s Hambantota Port fit the nation’s global strategic agenda, and that the location was situated in a nation ravaged by civil war and poverty, China seized majority ownership of the port in 2017, utilizing a systematic “debt-trap” ploy to lure the Sri Lankan government to relinquish local ownership.

In order to understand how China acquired the Hambantota Port, it is important to understand the history of Sri Lanka, and why the country progressed relations with China. The civil war between the 2 ethnic groups in Sri Lanka, the Tamils and Sinhalese, deteriorated the nation’s economy, and forced the country into a dire state, where they were reliant on foreign investments to rebuild the economy, and reconstruct damaged infrastructure. China offered the plagued island nation a solution to stabilizing the effects of the war, with seemingly benevolent loans to Sri Lanka, with ownership clauses encrypted within. China’s systematic targeting of the vulnerable nation eventually paid off, as Sri Lanka’s economic turmoil worsened; resulting in their debt burden being relinquished by providing China with majority ownership of the Hambantota Port, and 15,000 acres of land around it for 99 years.

On the surface level, it appears that China’s acquisition of Hambantota Port was a contingency that failed to fulfill the initial loan payment expected from Sri Lanka. However, upon closer inspection, one can infer the vast benefits of China gaining control over the port. The Hambantota Port is situated in a highly-coveted location within the Indian Ocean, as it is a focal point for trade routes connected to Europe, Africa, the Middle East, and Asia. In addition, the port is a few hundred miles off the coast of India, China’s fierce rival.

The formula used to seize control of Hambantota Port is one that has been perfected by China in its bid to become a global superpower and gain influence around the world. The incompetency of Sri Lankan officials has been replicated by other vulnerable countries worldwide, who look to quick, easy loans as a means to rejuvenate their economies. The African nation, Djibouti, is another nation who looks to be falling into the grasps of China, unbeknownst to the true intentions of their so-called “ally”. China is expected to invest up to 1.3 trillion dollars in infrastructure, which encompasses a trade route that stretches to Europe and Asia. Within Djibouti, China plans to build a port, two new airports, and a railway that bridges Ethiopia and Djibouti. As of 2019, it is estimated that 77% of Djibouti’s total debt is owed to China. Whilst the investments appear to be a stepping stone in alleviating infrastructure and economic conditions within these countries, it is highly likely that Djibouti, like Sri Lanka, will default in their debt payment, due to the nations constrained financial resources.

The predatory techniques utilized by China to seize foreign infrastructure and land deteriorate the already-weakened state of these countries, whose economies are deteriorated by the corrupt politicians at the helm of their demise. By offering the promise of aiding the development of these nations, China instead facilitates the negative autocratic regimes within these developing democracies. When Mahinda Rajapaksa, Sri Lanka’s president at the time, stated his intentions to construct a development port project in the idle town of Hambantota, many officials raised eyebrows regarding the purpose of this development. After all, the Port of Colombo was prospering, and had vast room to expand. Feasibility studies conducted by the Sri Lankan government had determined the port was not viable. Without the backing of his government advisories, Rajapaksa turned to the Chinese as a medium to finance the port. Recognizing that the project was doomed to fail, and by inserting a clause to gain ownership of the port and the land surrounding it, the Chinese willingly agreed to finance Rajapaksa’s vision. Regardless of whether the Hambantota Port will become profitable in the near future, China will utilize the land to strengthen their influence within South Asia.

As China’s global influence strengthens, world leaders must be wary about the Chinese debt-traps that seek to ensnare vulnerable countries. The predatory tactics used in Sri Lanka and Africa must be noted by world leaders of struggling democracies, who should strive to alleviate the economic conditions of their nations through local investment and improved education levels. The insatiable greed of autocratic rulers within developing democratic societies feed into the expansion plans of the Chinese, and unless world leaders and the counsel at their disposal take heed to history and past mistakes, they will suffer at the expense of China.