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Friday, March 20, 2015, 10:24

Sri Lanka reaffirms Sino ties

By PU ZHENDONG in Beijing and KRISHNA KUMAR VR in New Delhi

Foreign minister vows to support Maritime Silk Road and take relations to ‘new level of excellence’.

Sri Lanka reaffirms Sino ties
Sri Lankan Foreign Minister Mangala Samaraweera with Chinese Premier Li Keqiang in Beijing on Feb 27. The Chinese leader said bilateral problems, if any, must be solved in a ‘proper way to stand the test of time and storms’.(AFP)

Quashing speculation of a deteriorating bilateral relationship, Sri Lanka has made it clear that it is keen to take forward the friendship with China to “a new level of excellence”.

Sri Lankan Foreign Minister Mangala Samaraweera, who made the pronouncement during his visit to Beijing on Feb 27, said the new government would deepen the existing cooperation with China.

Samaraweera said his country was committed to building with China the 21st Century Maritime Silk Road, the program initiated by President Xi Jinping to improve connectivity along the historic trading route from China to Europe through the seas of Southeast and South Asia.

Further bolstering ties, Sri Lankan President Maithripala Sirisena will visit China later this month to attend the Boao Forum for Asia, a platform for dialogue on issues in the region, to be held from March 26 to 29 in Hainan.

Chinese Premier Li Keqiang said China’s relations with Sri Lanka stands “unaffected” in changing international circumstances and domestic situations during his meeting with Samaraweera.

“Problems in bilateral relations, if any, must be solved in a proper way to stand the test of time and storms. The development of one side is bound to benefit the other,” Li said.

Earlier, immediately after assuming power in Colombo, the new government under President Sirisena had indicated it would re-evaluate the existing China-funded projects in the island nation, including the Colombo Port City project.

“Some of the previous projects are being reassessed by the new government. There were allegations that certain projects didn’t have proper feasibility and environment impact assessment reports, and the new government is having another look at the project before taking a final decision on it,” Saman Kelegama, executive director at the Institute of Policy Studies of Sri Lanka (IPSS), tells China Daily Asia Weekly.

The Colombo Port City project deal was signed during Xi’s state visit to the South Asian country in September last year.

The $1.5-billion project, which involved transferring 108 hectares of land near the main commercial port of Colombo to China Communications Construction Company for luxury real estate development, was taken up for reexamination in February in terms of cost appraisals and environmental impacts.

However, the government has set a 100-day deadline to complete the investigation into the alleged corruption in the large-scale projects initiated by the previous government under former president Mahinda Rajapaksa.

“The investigation does not overshadow the generally close China-Sri Lanka economic ties, even in the context of power transition to a more neutral leadership,” says Wang Weihua, a researcher on South Asian studies at the Shanghai Institutes for International Studies (SIIS).

“After many years of conflicts, there is a vast need for development in Sri Lanka, and China is one of the few countries which can inject capital and personnel to tap the opportunities,” Wang says.

Recognizing the importance of Sri Lanka to gain a vital foothold along one of the world’s busiest international shipping lanes and to seek secure maritime supply routes, China has been actively engaged in developing ports in the country.

The first phase of the Hambantota Port development project — 85 percent funded by the Export-Import Bank of China — was built by the China Harbour Engineering Company, a subsidiary of the China Communications Construction Company, and Sinohydro, a State-owned hydropower engineering firm, at a total cost of $360 million.

The second phase of the port project, which will include a container terminal, is being built at an estimated cost of $800 million. After completion of the third phase, the port is expected to accommodate 33 vessels at any given time, making it the largest in South Asia.

A massive terminal, capable of handling 2.4 million containers a year, at the Port of Colombo — located midway on the lucrative east-west sea route — was built and operated by Colombo International Container Terminals, a joint venture between China Merchants Holdings and the Sri Lanka Ports Authority.

“We appreciate what China has offered over the past many years, and the country will continue to maintain friendly cooperation with China,” says Ajith D Perera, secretary general of the Federation of Chambers of Commerce and Industry of Sri Lanka.

China is also helping Sri Lanka build an international airport in the southern province of Hambantota. Funded by the Exim Bank at $210 million, the facility is being constructed by China Harbour Engineering Company.

However, Beijing has urged Sri Lanka to provide a “sound legal environment” to secure further Chinese investment while proposing to explore a trilateral cooperative mechanism among Beijing, New Delhi and Colombo.

“China will integrate its development strategy with its neighbors, and jointly build a community of common development and shared interests,” Li told Samaraweera during their meeting.

The two countries will stay committed to working together on the 21st Century Maritime Silk Road. China and Sri Lanka have also identified three major pillars of bilateral relations: Negotiation over a free trade agreement (FTA), infrastructure improvement and industrial cooperation.

“The FTA will provide preferential access for Sri Lankan products to the vast Chinese market, and thereby progress towards a more balanced and equitable bilateral trade,” Samaraweera said.

Describing the reexamination of the project sanctioned by the previous government as “a good thing” for foreign investors, including China, Samaraweera said the new administration wants to “create a rule-based investor climate, because some of the investments which were decided upon by the previous government were not totally given on merit”.

“The Chinese government will be kept informed of the process and outcome of the review,” said Samaraweera, adding that Sri Lanka’s political parties have “friendly China policies”.

Fu Xiaoqiang, an expert on South Asian studies at the China Institutes of Contemporary International Relations, says the review shows Colombo is more likely to follow a more cautious attitude toward accepting Chinese investment from now on, especially in the area of security, so as not to upset India.

“Both countries will still advance cooperative agreements signed previously, but it will not be a surprise to see the implementation shrinking or slowing down,” Fu says.

Changes in the new administration’s foreign policy are evident, which the minister described as a more balanced “middle path”, with the goal of engaging with the world.

However, China is keen to secure its investments in Sri Lanka, which is an important part of Beijing’s ambitious regional development initiative of the Maritime Silk Road. Sri Lanka was among the first countries to endorse the proposal when it was put forth in 2013.

During talks with his Sri Lankan counterpart, Chinese Foreign Minister Wang Yi said Beijing holds an open attitude toward trilateral cooperation between China, Sri Lanka and India, and stands ready to discuss possible fields and feasible approaches.

“The three countries, all boasting abundant Buddhist tourism resources, could consider cooperation in developing tourist routes,” Wang said.

Samaraweera hailed a tripartite agreement between India, China and Sri Lanka as “the most welcome”, saying the Indian government is “not at all concerned” about Sri Lanka’s relations with China.

“Sri Lanka needs to take care of India’s security concerns when approving Chinese-funded projects, and this fact has to be clearly explained to the Chinese during the discussions. This will avoid any misunderstanding between the two countries,” says Kelegama of IPSS.

Wang of SIIS says that the success of this cooperative model will require both China and India to ditch zero-sum competition and coordinate investment efforts in the region to achieve common development.

“It depends on how the three countries see differences — from a cooperative perspective or a confrontational one,” he sums up.

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Xinhua contributed to the story.

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