Sri Lanka hands over debt-laden port to Chinese owner

Sri Lanka Saturday handed over a deep-sea port to a Chinese firm, in a deal agreed to boost the cash-strapped island's finances that has raised concerns at home and abroad over Beijing's growing influence.

The $1.12 billion deal first announced in July lets a Chinese state company take over the southern port of Hambantota, which straddles the world's busiest east-west shipping route, on a 99-year lease.

"With the signing of the agreement today the Treasury has received $300 million," Prime Minister Ranil Wickremesinghe said at a ceremony in the capital to mark the handover.

"This is the beginning of our debt settlement," Wickremesinghe said.

The loss-making port will now be jointly managed by the state-owned Sri Lanka Port Authority and China Merchants Port Holdings.

Sri Lanka owes China $8 billion that former president Mahinda Rajapaksa's regime borrowed for its infrastructure development projects, including the port.

The deal has raised concerns at home and overseas, where countries such as India and the United States are known to be worried that China getting a foothold at the deep-sea port could give it a military naval advantage in the Indian Ocean.

On Friday Sri Lanka's parliament approved wide-ranging tax concessions for the port deal, including a tax holiday of up to 32 years for the Chinese firm, that opposition parties objected to.

"Please tell this House the details of very favourable tax concessions you gave China on the deal. What are you getting out of it?" Anura Dissanayake, an opposition law marker asked in parliament Saturday.

Sri Lanka has said it wants to reduce its high foreign debt with the proceeds of the Hambantota port deal, and is selling off some other enterprises to raise revenue.

US warns Russia over Ukraine at OSCE meeting
Vienna (AFP) Dec 7, 2017
The United States warned Russia on Thursday that its ties with the West can never recover until it pulls its forces out of Ukraine, as OSCE foreign ministers met in Vienna. Diplomats had hoped that meetings on the sidelines of the 57-nation body would make progress on agreeing terms for a UN peacekeeping force for war-torn Ukraine. But the major powers in the dispute are still far apart, ... read more

Related Links
Learn about the Superpowers of the 21st Century at SpaceWar.com
Learn about nuclear weapons doctrine and defense at SpaceWar.com

Thanks for being there;
We need your help. The SpaceDaily news network continues to grow but revenues have never been harder to maintain.

With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords.

Our news coverage takes time and effort to publish 365 days a year.

If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.

SpaceDaily Monthly Supporter
$5+ Billed Monthly

SpaceDaily Contributor
$5 Billed Once

credit card or paypal