Chinese FM Wang meets top Lankan leadership; discusses promoting investments, tourism

PTI | Colombo | Updated: 09-01-2022 17:22 IST | Created: 09-01-2022 17:17 IST
Chinese FM Wang meets top Lankan leadership; discusses promoting investments, tourism
Wang Yi Image Credit: Flickr
  • Country:
  • Sri Lanka

Chinese Foreign Minister Wang Yi on Sunday met Sri Lanka's top leadership and discussed a host of issues, including the debt crisis faced by the island nation, investments, promoting tourism, and the fight against the COVID-19 pandemic as the two countries marked the 65th anniversary of diplomatic ties.

Wang, who arrived here on Saturday from the Maldives on a two-day visit, first met the senior of the Rajapaksa brothers - Prime Minister Mahinda Rajapaksa - who took to Twitter to announce that he had a "very pleasant meeting" with the Chinese State Councillor.

''Had a very pleasant meeting with the Foreign Min of #China. Discussions centered around the logistics of facilitating the return of the many #lka med students to China. Also discussed were a host of issues inc Tourism, investments, #COVID19SL relief & post-Covid preparedness," Mahinda Rajapaksa said on Twitter.

He also thanked the Chinese government for its continued support of Sri Lanka.

''I thanked #China and her people for the continued support to #lka. As both our nations celebrate 65 years of bilateral relations, I am hopeful that this relationship we share will only grow & be strengthened in the years to come," he said in another tweet.

After he met with Mahinda Rajapaksa, Wang declared open the Port City Marina Promenade to the public - built with China's assistance on reclaimed sea - which is a major infrastructure Chinese project here.

The port city which is yet to become fully operational has a financial district that has been dubbed the new hub between Singapore and Dubai - with a marina, a hospital, shopping malls, and 21,000 apartments and homes.

Later, Wang met President Gotabaya Rajapaksa who told the Chinese leader that Sri Lanka would be much helped if consideration could be given to rescheduling of its external debt.

It is estimated that Sri Lanka owes debt payments to China in the region of USD 1.5 to 2 billion this year.

The international rating agencies have expressed doubts over the island nation's ability to meet its international sovereign bond payments of USD 1500 million, the first USD 500 million of which falls next week for payment.

The Lankan President also said that if a concessional trade-credit scheme could be obtained for imports from China, it would enable industries to run smoothly.

Wang's visit is taking place at a time when Sri Lanka is facing its all-time worst foreign exchange crisis.

By December, the reserves position had plummeted to just one month's imports or a little over USD 1 billion.

However, by the end of the year, the Central Bank announced that the reserves position had improved and the cash realization was believed to have come from a previously agreed currency swap with China.

In recent months, the public has experienced a shortage of many essentials due to the foreign exchange crisis. Import restrictions to save dollars have threatened cooking gas and fuel supplies in addition to the looming power cuts.

With the realization of a currency swap from China, the reserves topped USD 3 billion by the end of last year.

During his meeting with Wang, the Lankan president was also appreciative of the Chinese Covid-19 vaccination support by ensuring the continued supply of the Sinopharm vaccine.

Wang's visit marks the 65th anniversary of diplomatic ties between the two nations and the 70th anniversary of the Lanka-China Rubber Rice Pact.

Signed in 1952, the Rubber-Rice Pact was a trade agreement between Lanka and China under which Colombo supplied rubber to Beijing in exchange for rice, leading to the establishment of diplomatic relations and expansion of trade between the two nations.

The relationship between the two countries has been under stress in recent months.

China protested against Sri Lanka's rejection of an organic fertilizer shipment which the local farmers and some experts claimed was contaminated.

The Sri Lankan commercial high court here blocked payment for it despite top-level interventions by China. The Chinese black-listed the Sri Lankan state bank for not honoring the payment.

Sri Lankan scientists had questioned the quality of the Chinese fertilizer consignment, saying that instead of helping, it could prove harmful to the crops.

However, on Friday, on the eve of Wang's visit, Sri Lanka's People's Bank released USD 6.9 million US to the Chinese company.

China's blacklisting of the Sri Lankan bank and the public clash between officials on both sides had come amid growing concerns over an acute agriculture crisis in Sri Lanka, following President Gotabaya's decision in May last year to abruptly switch from chemical to organic fertilizers.

The decision triggered protests from farmers who said the fertilizer ban would result in a reduction in harvest, leading to a food crisis this year.

China in December suspended a project to install hybrid energy plants in three islands of Sri Lanka, citing ''security concern'' from a ''third party'', amid reports of India raising concern over its location.

In early 2021, India lodged a ''strong protest'' with Lanka on the award of the tender to the Chinese company for the construction of renewable energy power plants in Delft, Nagadeepa, and Analthivu.

China also said they were abandoning their projects in the northern Jaffna district's islets owing to pressures from India.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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