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Sri Lanka, struggling with debt, hands over a major port to China

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Sri Lanka, struggling with debt, hands over a major port to China Empty Sri Lanka, struggling with debt, hands over a major port to China

Post by Guest Tue Dec 19, 2017 11:39 am

NEW DELHI — Struggling to pay its debt to Chinese firms, the nation of Sri Lanka formally handed over the strategic port of Hambantota to China on a 99-year lease last week, in a deal that government critics have said threatens the country’s sovereignty.

In recent years, China has shored up its presence in the Indian Ocean, investing billions of dollars to build port facilities and plan maritime trade routes as part of its “One Belt, One Road” initiative to help increase its market reach.

Along the way, smaller countries like Sri Lanka have found themselves owing debts they cannot pay. Sri Lanka owes more than $8 billion to state-controlled Chinese firms, officials say.

Sri Lankan politicians said the Hambantota deal, valued at $1.1 billion, was necessary to chip away at the debt, but analysts warned of the consequences of signing away too much control to China.

“The price being paid for reducing the China debt could prove more costly than the debt burden Sri Lanka seeks to reduce,” said N. Sathiya Moorthy, a senior fellow specializing in Sri Lanka at the New Delhi-based Observer Research Foundation.

https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-china-port.html

99 year lease means, for all practical purposes, that this Sri Lankan port has been sold to China for $1.1 billion

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