Unity govt. should fulfill its intended task

By Gamini Abeywardane

National governments are a rarity. The concept originated in the UK around the time of the Second World War as there was a great need for all to get together against a common enemy – the Axis forces led by Adolf Hitler. The concept often has been promoted or spoken about in the democratic world whenever there is a need to work together in the interest of the nation.

In Sri Lanka the need for forming a national government had been spoken about many times in the past prior to 2015, the closest possibility being on the aftermath of the 2004 tsunami. However, there was no genuine desire or any practical possibility to form one until the incumbent yahapalana government was formed.

Thus, the formation of a national government with the participation of the two main political parties in the country was a rare development, if not a once-in-a-lifetime phenomenon. The immediate reason behind it, was to achieve certain national objectives which are impossible for one political party to achieve without the active support of the other.

 The main objectives included abolition of the eighteenth amendment to the Constitution and reversing dictatorial trends through several independent commissions; introduction of good governance and re-establishment of the Rule of Law; improved diplomatic and trade relations with the western countries; reaching consensus on vital economic reforms; effective dealing with the UNHRC on allegations of human rights abuse; national reconciliation and resolution of the northern problem through constitutional means; investigating into allegations of large scale corruption; creating a proper environment for attracting foreign direct investment; and electoral reforms.

While there is progress in some of these areas the government has miserably failed in several other areas, particularly in resolving the northern issue, fighting corruption and attracting foreign investments. Of all these there are two vital issues, the resolution of which needs nothing but a national government –northern issue and fighting corruption.

Tolerating corruption

On the issue of corruption the biggest drawback is the central bank bond scam which happened under the auspices of the very government that came into power with an electoral promise to curb all corruption and to catch and punish those from the previous administration who were accused of large scale corruption.

However, on the positive side is the air of newly ushered freedom and transparency which enabled opposition members of the parliament to campaign and force the government to appoint a presidential commission to look into the alleged scandal.

Also, on the negative side is the inability of this government even to expose or prosecute anybody from the previous government for complicity in any acts of corruption or undue enrichment. On the contrary, there have been allegations of willful delay in proceeding with such prosecutions making a mockery of some of the basic tenets on which this yahapalana government was set up.

Some of these allegations may not be easily provable; yet, the real issue is that there doesn’t seem to be any genuine effort by those in control of the government to go ahead with such prosecutions irrespective of whatever the final outcome is going to be.

No country has succeeded in bringing down corruption to zero level. What is needed is a system of justice, fair play and transparency where any acts of corruption gets exposed and perpetrators brought before the law so that it would become the strongest deterrent against anyone who is likely to get involved in corruption in the future.

The government has so far failed to create such an environment and on the contrary, by its own inaction, has created a situation where people will take it for granted that political corruption will never be exposed in this country. There cannot be a better encouragement than this for politicians who want to make money by wrongful means to proceed.

Northern issue

On the most important issue of resolving the long standing issue of the Tamils of the north there was much expectation at the time the joint government of the UNP and the SLFP was set up. That is because it’s well-known that throughout the history, whenever a government was genuinely interested in finding a constitutional solution to this issue the main opposition party has never co-operated.

Whenever the UNP wanted to resolve the issue, the SLFP opposed and scuttled it and similarly, whenever an SLFP government took steps to resolve it, the UNP scuttled it. This was the fate of Bandaranaike- Chevanayakam Pact as well as Dudley- Chelvanayakam Pact, two genuine efforts to resolve the issue in the past.

That is the background which gave rise to the thinking that only a national government consisting of both these parties that could one day resolve this problem. Thus, when the national government was formed there was much expectation in this regard among the minorities that supported it.

Despite appointment of a parliamentary steering committee and holding of a series of public discussions and preparation of several reports based on the views of a fair cross section of the public and the professionals, much progress is yet to be achieved. The main reason is lack of consensus between the two parties on the nature of the constitution they want to evolve and rather unfortunately the abolition of the executive presidency, a main promise on their electoral platform, has been one such area of contention.

The resolution of the age-old northern issue by itself is a difficult task because of the historical fears of the Sinhala community about separatism and some of the unreasonable demands made by the extremists in the north. Apart from their traditional opposition to devolution of power the bitter memories of the LTTE’s terrorism also makes it more difficult for the government to get the approval of the Sinhala majority for a constitutional solution to the northern issue.

While these traditional difficulties are quite understandable, the strangest development is the inability of the two parties to agree on the constitutional package. So, it is fundamentally important for the two main partners of the government to have some internal consensus between them on these proposals in order to place them before the people.

If the executive presidency is the issue they should leave it aside and at least agree on the possible devolution package under a presidential system. Presidency should not stand in the way of a solution to the northern issue because the Tamils have never asked for the abolition of the executive presidency. It is sensible to complete what is doable during the tenure of the unity government rather than wasting time arguing on the impossible.

Electoral priorities

Meantime there are some developments within the government, particularly within the UNP that will have a direct bearing on these issues. The current wave of political action mostly spearheaded by the young backbenchers of the UNP who have been disgusted over things like lack of direction, slowness in corruption investigations seem to be bearing fruit.

Some of the effects of this have been resignation of Foreign Minister Ravi Karunanayake and the moves being taken against Justice Minister Wijedasa Rajapaksa in the UNP working committee.

On some of these critical issues this group has been having a simultaneous dialogue with both Prime Minister Ranil Wickremesinghe and President Maithripala Sirisena and they seem to have the capacity and the will to change the future course of the government.

Even at the party level democracy seems to be prevailing and these are healthy developments that can put the government on the correct track. At the same time, with the strong possibility of holding either provincial or local government election early next year the government seems to be getting ready to face people.

The strongest signal in this direction came from the duty reduction on motor cycles and single cabs and use of mobile telephone data. As such the possibility is for election priorities to take centre stage of politics in the next few months. It will also provide the opportunity for the unity government to realign itself and test their popularity among people.  

Despite much friction and occasional disagreements, it is unlikely that the two parties in the government will fall apart and they should remember that their historic responsibility as a national government is to renew their MOU and finish the primary task of the national government before the expiry of their term. Among them stands the resolution of the national issue, a responsibility from which the only national government ever to be formed in the country cannot and should not shirk.

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Democracy galore, but no strong government

 

History shows that our people need both democracy and a strong government and they are not ready to sacrifice one for the other. Then the question is how do we achieve this constitutionally? This is something that should receive adequate attention of our legislators and other interested parties, especially at a time some new constitutional proposals are being developed through a steering committee of the parliament.

By Gamini Abeywardane

Much anticipated resignation of foreign minister Ravi Karunanayake took place on Thursday, ending weeks of speculation. Irrespective of whether it was forced or voluntary, resignation itself was a salutary move. Whenever high officials are accused of wrong doings and investigations begin, in most established democracies it is customary for them to resign facilitating impartial enquiry.

On the contrary, in the last several decades in our country, irrespective of whatever accusations, resignation of officials or politicians holding public office was almost unheard. Thus, our political culture despite much negativity seems to be undergoing some healthy transformation following the political changes that took place two years ago.

The first sign of it was seen when then Law and Order Minister Tilak Marapana resigned over the Avant Garde issue. Even the recent resignation of Finance Minister Mangala Samaraweera’s PRO over some drug related issue pending police inquiry, though at a lower level was something in this direction while the most high profile one was that of minister Karunanayake.

The controversial bond issue and the need for punishing those involved is entirely a different issue. No doubt the resignation of the foreign minister saved the government from a bigger embarrassment of facing a no confidence motion in parliament which was likely to be supported by some members of the two governing parties as well.

At the same time the fact that he had to resign and the circumstances that led to his resignation would be both an example as well as a deterrent to any future wrong doer, if such person is holding public office.

Then, the other salutary development is that despite Ravi Karunanayake’s criticism of the officials of the Attorney General’s department over the way he was interrogated at the commission of inquiry, there is a great degree of freedom for law officials to act without fear particularly after the establishment of independent commissions under the nineteenth amendment to the constitution.

However, amidst all these healthy developments the negative side is that despite promise of good governance the new administration has failed to provide any convincing alternative in the form of a corruption free environment. Neither have they been able to provide any relief to the people.  As a result there seem to be much disillusionment and confusion and to add to them all, there is an aura of lack of control or direction.

Controversial public utterings

This is more than evident from various public statements made by key politicians in both governing parties. On vital issues there is no unanimity or agreement among the key players of the government and the public statements made by ministers against certain government decisions long after they were approved by the cabinet seem to be going against the idea of collective responsibility and party discipline.

A high point in this type of behaviour was seen in recent utterances made by a cabinet minister against Hambantota port deal. He went to the extent of saying that he does not agree with handing over the management of the port to the Chinese and would do everything possible to take it back from their control and nationalize it.

While the country is facing a huge debt issue and government has no choice other than working with the Chinese who have the capacity to develop the port, statements of this nature without offering any other alternative solution will only further complicate matters for the government.

Another cabinet minister was seen publicly criticizing the government’s official position over the SAITM issue. He attacked the government’s decision to continue with SAITM while showing much sympathy to medical students who are currently on strike, but did not indicate his opinion on the future of private medical education in the country.

When ideas diametrically opposed to the opinion of the government are publicly promoted by members of the cabinet, on one hand it becomes an encouragement to those who are organizing public protests against the government while on the other it further confuses the people who have been bewildered by infighting even among cabinet members of the same party

While re-establishing the tradition of resignations in the face of public antipathy is a welcome sign there seem to be serious issues with regard to concept of collective responsibility in the cabinet and general party discipline. These are vital traditions which are necessary for a democratic government to function.

If a minister is against a certain decision by the government there is ample opportunity to oppose it at the cabinet meetings. If the majority of the ministers agree to it despite opposition from one or two the tradition is to go by the majority decision.

If the disagreement is of a serious nature and on a vital matter such members have the option of leaving the cabinet but continuing to make harsh public statements critical of a major government decision is in total violation of the concept of collective responsibility which requires that members of the cabinet must publicly support all governmental decisions made in Cabinet, even if they do not privately agree with them

One aspect of collective ministerial responsibility is that ministers share responsibility for major government decisions, particularly those made by the cabinet and, even if they personally object to such decisions, ministers must be prepared to accept and defend them or resign from the cabinet.

The other important element that is being seriously eroded seems to be party discipline. Although there has to be freedom for all members to express their own personal opinions, in a democracy parliament works on the basis of a party system and members of each party have to adhere to a certain set of policies which keep them together.

In the modified presidential system that is currently in operation in our country strict adherence to collective responsibility or party discipline as they are found in a Westminster system may not be possible. However, if the parliamentary system is to work there need to be some form of collective responsibility and party discipline and the public statements of ministers should indicate who belongs to which party.

This lack of disciple becomes quite conspicuous in the eyes of the people because of the strict contrast with the seemingly disciplined environment that prevailed under the previous government. Despite whatever allegations of authoritarian trends there was disciple, a sense of stability and a strong government,

The change of government happened mainly on issues of freedom, democracy, rule of law and corruption. The very people who were instrumental in bringing about this change now seem to be bewildered and confused as to which direction we are moving now.

Some government politicians have argued that public protests that are happening almost on daily basis are symptomatic of the new found freedom after many years of repression. But given the current situation in the country the question will naturally arise as to whether the members of the two political parties in the government are also still enjoying such new found freedom.

Need for a strong government

History shows that our people need both democracy and a strong government and they are not ready to sacrifice one for the other. Then the question is how do we achieve this constitutionally? This is something that should receive adequate attention of our legislators and other interested parties, especially at a time some new constitutional proposals are being developed through a steering committee of the parliament.

We need a strong institutional framework with adequate powers to deal with wrong doers and corruption without political interference and a proper electoral system to ensure that only suitable people are elected as members of parliament as well as provincial and local government bodies.

Relying on individuals to achieve these objectives will not serve any purpose because the tendency will be to consolidate his or her own position or that of their clan after doing one or two right things. Therefore, the better way would be to develop strong and dependable democratic institutions similar to those found in the United States and other established democracies in the west.

Under the Soulbury Constitution we had perfect democracy but often had weak and wavering governments while change of government was too frequent. On the other hand, executive presidency while providing a stable government took the country almost to the brink of a dictatorship.

The way this government is running we see that the existing system of combined governance also has failed to produce expected results. What is apparent now is two people with almost equal power cannot run a country. As such finding a suitable mid-way with stability and democratic institutions which ensures participation of all communities is a must. It is up to the constitutional experts and the parliament to come up with a solution.

 

 

 

 

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Same day PC polls a fantastic idea, but delay in elections can nullify all its good effects

 

The best compromise would be to do all the necessary electoral reforms within the shortest possible time and to have the elections without delay so that it will be a win-win situation for both people and the government. In a democracy people are entitled to a good electoral system as well as an unhindered opportunity to exercise their right to vote.

 By Gamini Abeywardane

The idea reportedly mooted by the government recently to make it compulsory by law to have all provincial council elections on the same day, on the face of it, is a salutary move. Due to whatever reasons, when the provincial councils were set up by the J R Jayewardene government they did not introduce the same day election rule for PCs. If it was deliberately done the motive would have been to keep the option of testing the waters by having these elections one by one so that it would always be for the advantage of the government in power.

Following the thirteenth amendment to the Constitution the first provincial council election was held in April 1988 only in four provinces – Wayamba, Uva, North Central and Sabaragamuwa, because of the bad security situation that prevailed at the time. The elections to the other provinces were held subsequently, again not on the same day but on a staggered basis.

Upon the expiry of their term elections to seven provincial councils other than the north and the east were held on the same day in May 1993. That means although the election law did not strictly prescribe the necessity for same day elections, the normal practice applicable to parliamentary elections was followed in this regard as well. The elections in the north and the east were not possible because the amalgamated province had been taken under the central control by that time following the unsuccessful attempt by Vartharajah Perumal to declare independence unilaterally.

Thereafter, each time when provincial elections were held it was for two or three provinces and thus we inherited a situation where a few PCs complete their term every two or three years. This gave a good opportunity for incumbent governments to test their popularity from time to time and act accordingly without having to face the risk of islandwide elections at once and every government has been using this distortion for their own advantage.

Now the cabinet has already approved a proposal to amend the election laws and the Constitution to make it compulsory to have all provincial elections on the same day. But the problem is, even if the law is passed, how do we get it straight with terms of PCs ending on different dates? One way is when one or two provincial councils finish their terms around September to dissolve the remaining councils as well and to have elections for all. The other option will be to put the PCs which will be finishing their terms early under presidential control and wait till the all others finish their terms.

The first option will be disadvantageous to all PC members who have considerable time to finish their terms and therefore such a move is likely to be opposed by the respective provincial councils. The exercise of the second option will mean postponement of PC elections and that kind of move will any way be resisted and opposed by all opposition political parties who have already been clamouring for early local government elections.

The governing parties will naturally think that postponement of any election is going to be in their advantage given the wave of problems and the public protests they are currently facing. The other issue is the major split in the SLFP which has been deteriorating over several months and the party will need reasonable time to sort out their issues. Then UNP under Prime Minister Ranil Wickremesinghe has been too busy with mega economic plans and reforms and seems to be not concentrating on any grassroots level political activities that are vital if they are to face any election.

Now the local government elections have been due for a long time and technically they have to be held before the provincial elections. However, despite necessary draft legislation for reforming the electoral system being before parliament, still there is no clear sign about holding such elections in the near future.

However, as the legal position stands today there is no room to postpone provincial council elections whenever they become due and the Elections Commission has already made it clear. The terms of the Eastern, North Central and the Sabaragamuwa Provincial Councils will expire between September 6 and October 1. Any change in this situation can occur only thorough the amendments to the provincial election laws which are likely to be taken up soon.

Whichever election is going to be held first, the problems that are to be faced by the government will be the same. With the split in the SLFP such an election is going to be fought by three groups unless the two governing parties decide to form a coalition. Facing such an election alone is a difficult task for the SLFP faction led by President Maithripala Sirisena. On the other hand, the Joint Opposition backed by former president Mahinda Rajapaksa which has been demanding early elections seems to be under the belief that they can enhance their lot at any future poll.

PC electoral system

While the debate over PC elections is on another idea that has already come up is the need for changing the electoral system of the provincial councils. Draft laws for reforming the local government electoral system and introducing a hybrid system being ready, one may propose why not introduce the same for PCs as well. The constitutional process that is going on in the parliamentary steering committee has already developed some comprehensive proposals to introduce a hybrid system at national elections so that it becomes meaningful to have the same for PC polls as well. These are proposals beneficial to the people and electoral reforms at all levels should happen sooner or later.

Many governments in the past while accepting in principle that PR system is not in the best interest of the people, have gone on postponing the electoral reforms for petty reasons. On the other hand, it is equally bad if the current government starts working on these ideas of reforms and drags their implementation with the ulterior motive of postponing elections until the final years of their government’s term.

The best compromise would be to do all the necessary electoral reforms within the shortest possible time and to have the elections without delay so that it will be a win-win situation for both people and the government. In a democracy people are entitled to a good electoral system as well as an unhindered opportunity to exercise their right to vote.

Need for being security conscious

Meanwhile several security related issues have surfaced in the north in the past few months and these developments could well be disadvantageous for current attempts to develop a constitutional solution to the long standing northern issue.

The latest is the sword attack on two policemen in Kopai preceded by the incident which ended the life of the police sergeant who was handling personal security of Jaffna’s High Court Judge. Some of the persons who have been arrested in connection with these incidents have been proved to be ex LTTE cadres.

In the past one or two years there have been many such incidents including discovery of some arms and ammunition in several locations followed by the arrest of a number of ex-LTTE cadres. The IGP Pujith Jayasundara has pointed out that some of the recent incidents are akin to the things that happened during the formative years of the LTTE and it is not possible to say that we have totally eradicated terrorism from the country. 

All this shows the importance of national security and alertness despite absence of war and the popular belief that terrorism has been almost wiped out from our country. In this age and time where terrorist groups are powerful enough to shake even mighty nations, emergence or re-emergence of terrorism could be a matter of time. So, the mere fact that the war is over in our country should not be a reason to be complacent about national security.

With a history of insurgencies, terrorism and war running into well over three decades, Sri Lanka can ill-afford to ignore the need for strengthening its armed forces and intelligence services. This will become more relevant as the country grows economically and increases its asset base – industrial installations, power stations, ports and airports etc.

In the context of current internal and regional developments, it is likely that terrorism will continue to remain an eternal threat in the foreseeable future. No country can afford to be lax on matters of security and some of the recent happenings are a grim reminder for the necessity of being security conscious.

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WHY DID SRI LANKA SEEK CHINESE INVESTMENTS IN PORTS?

By Thilini  Kahandawaarachchi

 

During the last decade, China has heavily invested in ports across the world spanning from Africa to Australia. In South Asia, they built the Gwadar port in Pakistan and the Hambantota Port in Sri Lanka. Despite being a staggering US$1.12 billion investment, last week’s tripartite agreement between Sri Lanka Ports Authority, China Merchant Port, and the Ministry of Ports and Shipping has left many criticizing China’s investments in the Hambantota port. In light of China’s potential long-term strategic goals, many view Chinese involvement in Sri Lanka with unease. However, it is often conveniently ignored that it is the successive governments of Sri Lanka that actively sought Chinese investments. Therefore, it is important to examine why we sought Chinese investments in the first place.

China has been a forthcoming and non-interfering alternative to funding from international financial institutions and Western donors. They have the excess capital and the capacity to take high risks, and they financed the construction of the Hambantota Port at a time when no other country or development partner was willing to invest in it. Now a Chinese company has yet again come forward to further invest in the Hambantota Port to develop it rather than let it squander its immense potential while generations of Sri Lankans serve the debts on a non-performing port. From an International Relations point of view, China also serves as a counter balance against the regional hegemony of India and other influences on Sri Lanka.

Therefore, rather than solely blaming China for their opportunistic investments, it is important to recognize that it is our governments that have voluntarily and actively sought these investments and exercised their (our) will when they reached out to China to fund a massive port project among other infrastructure projects.

An investor, a donor, and a trade partner

Since the turn of the century, China’s exponential growth  and increasing influence in many regions spanning Australia, Africa, and South America have attracted the attention of the world. China has not spared South Asia in its unquenchable thirst for resources, search for strategic locations, and reach for emerging markets.

According to the Heritage Foundation’s China Global Investment Tracker, from 2005 to 2014 China spent US$870.4 billion in worldwide investments and contracts, out of which US$8.9 billion was invested in Sri Lanka. In contrast, according to the International Finance Corporation (IFC), which is part of the World Bank group has made cumulative investments worth US$596 million in Sri Lanka.

Even though Chinese investments in Sri Lanka are a very small fraction compared to China’s global investments in regions such as Africa or South America, taken in context and compared to other global investors such as the IFC, these are considerable figures, and China’s investments in infrastructure are prominent.

Chinese investments, grants, and trade are all intricately interlinked. In Sri Lanka, China is the biggest source of Foreign Direct Investment (FDI) pumping in more than US$400 million in 2014. China has been involved in a variety of projects such as the Norochcholai Coal Power Plant, Mattala International Airport, Katunayake Airport Expressway, Moragahakanda Irrigation Development Project, and the Southern Expressway, which is also the country’s first highway.

China has also been the largest donor since 2009. China extended US$1.2 billion worth of assistance in the form of grants, loans, and credit amounting to 54% of the total US$2.2 billion committed by foreign countries and multilateral agencies. On the other hand, the Asian Development Bank invested only US$423 million and the World Bank US$241 million. China provided Sri Lanka US$5 billion in aid over the last decade.
Some of China’s lavish gifts to Sri Lanka include prominent landmarks such as the BMICH, the Superior Law Courts complex, and the Lotus Pond (Nelum  Pokuna) Performing Arts Theatre among others. China also fulfilled 65% of its total pledged assistance to Sri Lanka.

China is not only a key investor and donor, but also a significant trading partner. It surpassed the United States as Sri Lanka’s second-largest trading partner behind India in 2013. In the same year, Sri Lanka’s bilateral trade with China exceeded US$3 billion. All these growing aid packages, trade relations, and investments indicate China’s increasing involvement in Sri Lanka and its lasting footprint in the region.

From string of pearls to one belt one road

Foreign policy analysts have explained China’s expansion in South Asia in the new millennium with diverse arguments. The most well-known among them, especially with regard to port construction is the theory of “string of pearls” which examines the intention of China in building commercial and potential naval bases along the Indian Ocean region, including countries encircling India.

Earlier this year, China turned the string of pearls theory propounded by the west on its head with the launch of One Belt One Road (OBOR) initiative. With OBOR, China is expected to play a global leadership role in building infrastructure connecting China, Asia, Europe, and Africa through ports, highways, railroads, pipelines, power, fibre and other networks.

A favourable alternative funder

Sri Lanka has enjoyed strong bilateral ties with China for decades. There are a number of reasons for Sri Lanka to prefer China to Western countries and multilateral organisations such as the International Monetary Fund (IMF), the International Development Agency (IDA), the World Bank, and the Asian Development Bank (ADB) to obtain funds. Unlike multilateral institutions, which impose numerous conditionalities based on human rights, democracy, and good governance, when extending development loans, China does not interfere in the internal workings of loan/investment recipient countries. Many countries perceive the conditionalities imposed by international organizations as undermining their sovereignty.

According to former Sri Lankan Foreign Secretary Palitha Kohona, the Chinese government believes that low-key communication and mutually beneficial dialogue, carried out on an equal footing is more efficient than the US approach of distributing money and exerting pressure.

Further, Western countries distanced themselves from Sri Lanka post 2009 based on war crimes allegations. During the nine-year tenure of President Rajapaksa, Sri Lanka moved away from its traditional funding partners such as the ADB, IMF, the World Bank and western countries, and inched closer to China. Though the present government initially seemed to distance itself from China in 2015, soon it realized that the West does not have the kind of resources that China has to support Sri Lanka, and that China’s tentacles in Sri Lanka are too deep. Besides, in the new world order, China is too big a player to take for granted anyway.

Unlike Western donors who have been reluctant to invest in these high-risk, large-scale infrastructure projects, China is ‘forthcoming’ with their development support and investments.

A counter balance for India and external influences

India has long seen itself as the natural leader in the Indian Ocean region and wants to ensure that its namesake ocean remains India’s Ocean. However, many countries both within and outside the region consider that the Indian Ocean is not only India’s backyard but also a region to which both littoral states and outside powers have a claim. With increasingly strong ties with the US and aims to curb China’s expansion in the region, India threatens to become an ever-greater hegemon in the region. While the US is strengthening ties with India, countries such as Pakistan and Sri Lanka are strengthening their ties with China as a way to counterbalance the regional hegemony of India.

A closer look at Asia reveals that one of the biggest fears for many countries in the region is strategic encirclement. India fears encirclement by China, while China fears encirclement by the US based on the close relations that US has with Japan, Taiwan, South Korea, and also its military presence in Afghanistan. When countries in South Asia reach out to China to fund their infrastructure projects, they are also driven by the fact that closer ties with China will be a way to balance power with India.

China has also been a formidable friend by supporting Sri Lanka in diverse international fora. For example, in 2012, China was strongly against the United States backed UN Human Rights Council Resolution against Sri Lanka. Supporting Sri Lanka against the UNHRC resolution, the former Chinese Foreign Ministry spokesperson Hong Lei stated that China opposes “using a country-specific human rights resolution to impose pressure” and China believes that the Sri Lankan government and people are capable of handling their own affairs. Though not openly admitted, Sri Lanka’s closer ties with China is also a balancing act to prevent the influence or interference from India, USA and other global players.

Achieving long-term development goals

Chinese investments are also justified as a way to achieve long-term development goals in terms of infrastructure development, employment generation, and trade expansion. The former government claimed that one of its main targets at the end of the war was to catch up on thirty years of lost development opportunities. China with its multi-million-dollar investments to put in place much-needed infrastructure became a dependable friend.

Considering that Sri Lanka is located at a strategically significant point along the Indian Ocean, Hambantota aims to be a hub port between Singapore and Dubai. When the Hambantota port project was proposed, the Sri Lankan government claimed it would bring in prosperity to one of the least developed regions of the country and create job opportunities and boost the local and regional economy. The increased economic activity is expected to boost economic development and contribute towards improving regional transport linkages.

Last week’s agreement for Chinese investment in Hambantota is endorsed with expectations of skilled employment generation, regional and national economic development, stabilising the Sri Lankan rupee, and the reduction of national debt percentage. Further, better transport infrastructure will provide better access to regional markets, especially those of growing economies such as China and India.

What’s in it for China?

There are a number of strategic, political and economic reasons for China to be interested in the Indian Ocean region and South Asia in particular. Though a Chinese naval base in Sri Lanka is far-fetched, it is evident that China is interested in maintaining its presence in the Indian Ocean region because of its strategic, economic, and political importance. Sri Lanka is key to gaining a strong foothold in the region and as a mid-point in the Indian Ocean where its vessels can refuel and crews can rest and recuperate.

As the world’s leading manufacturing hub and the second largest economy, China also needs to secure energy and goods supply routes along the Indian Ocean. Therefore, it is only natural that China is interested in gaining a firm foothold on strategic locations along the Indian Ocean such as Hambantota and find alternatives to chokepoints such as the narrow Malacca strait.

Further, these projects provide Chinese companies opportunities to engage in large-scale investments and earn revenue for decades. They also provide employment opportunities for Chinese labourers and for businesses to export Chinese machinery to be used in these projects. These investments also boost China’s soft power strategies by creating a presence and by being a catalyst for development. The growing economy of Sri Lanka provides a market, albeit small, for China’s manufactured goods. China is also strategically gathering supporters with these intricately linked economic, trade, and cultural relations.
I

n 2014, China established the Asian Infrastructure Investment Bank (AIIB), a multilateral organization, which will fund infrastructure projects in Asia. It will enable Asian countries to improve their infrastructure while China can strengthen its economic and geopolitical leadership. China has taken a bold step by stepping outside of the  established US-centric multilateral funding agency system and creating a China led-bank to fund diverse infrastructure projects in the region. The AIIB is also a strategy for China to legitimize its involvement in building infrastructure across the world and expand its reach beyond the periphery. Further, it is also a move away from the Washington based banks and Western norms to adopt a new set of norms and values based on China’s own experiences both as an investor and a developing country.

It is based on all those interests that China is making large-scale investments in maritime infrastructure in Sri Lanka and other South Asian states, and China insists that their investments are only pacific and based on goodwill between long standing friends such as Sri Lanka.

Conclusion

By nature, infrastructure developments are long-term projects that often take decades to actually reap their intended benefits. They often require further investment to develop facilities to make these projects profitable. Hambantota port was built as a transhipment and bunkering facility to refuel and provide supplies to the large number of ships that ply the main east-west shipping route. It still requires considerable investments to improve its services and facilities to make it a fully functional port.

The proposed Industrial Zone in Hambantota is important because a port needs goods to export, and the Chinese investments in the Industrial Zone will help to generate that volume. To reach its potential and reap the intended benefits of this port, it is important to implement long-term plans for Hambantota and not abandon it. That is where continued Chinese investments in Hambantota port makes sense. The Sri Lankan government does not have the funds to develop it, no other global port operator is interested in developing it, and now there is a global Chinese port operator investing in it albeit for 99 years on terms largely favourable to them. For Sri Lanka, what better alternative is there?

Speaking of China’s initial involvement in Hambantota, a senior Sri Lankan shipping professional says, “beggars are not choosers. We did not have the money or the expertise to develop a port. We had not built a port in the last 100 odd years… we could have bargained much better terms (with the Chinese investors) but at that particular time, we needed to see fast development.” No other country would be able to give some of the instruments that are required to build these infrastructure projects and the Chinese are very particular about timing and speed. That sums up yet another reason why Sri Lanka reached out to China for funding this port in the first place.
While it is true that Sri Lanka did not have many options but to depend on Chinese loans and investments, there are also a number of factors such as non-interference, lack of conditionalities, China’s expertise and effectiveness in infrastructure development, and continued good relations that make  China’s investments attractive.
The high interest rates, strict commercial conditions, and the alleged lack of respect for laws or the environment are some of the numerous drawbacks of Chinese financing and moreover, the lack of transparency in agreements with China has led to many controversies and alleged corruption. Now, add to all of that a 99-year foothold for China in Sri Lanka, and there is also the question what will China want next?

However, despite the common perception that China is opportunistically using Sri Lanka and many other countries as pawns in their great game in the Indian Ocean, it is in fact the Sri Lankan governments that have sought Chinese loans and investments. If our government plays its cards right, it is Sri Lanka that will eventually benefit from China’s investments. For that, it is important that the Sri Lankan government does what is needed to attract more FDI, develop an export economy, address issues of corruption and deliver on the promised good governance. Irrespective of whatever government is in power, it is also crucial to ensure that Sri Lanka does not become a playground for regional power struggles. Only time will tell whether that is too much to expect from our governments and its servants.

(Thilini  Kahandawaarachchi is an   experienced research and communications professional and has served several diplomatic missions and the private sector. She is also an Attorney-at-Law. This article is based on her Master’s thesis titled “Politics of Ports: China’s investments in Pakistan, Sri Lanka and Bangladesh” at the University of Washington, where she was a Fulbright Scholar. The views expressed here are solely those of the author in her private capacity.) (Email:thilini@uw.edu)

(Courtesy: www.nation.lk)

 

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