China’s Envoy to Sri Lanka Qi Zhenhong, his wife, and a couple of Chinese investors paid a three-day official visit to the Eastern Province from 24 May, which was a low-key visit compared to his visit to the Northern Province, which caused a stir. It was an intriguing visit in which Eastern Province Governor Anuradha Yahampath took them around, showing them potential investment projects as well as plots of land that are available for Chinese projects, including a land that belongs to the Trincomalee Harbour and investment using Pulmoddai mineral sand.
The Governor has presented the Chinese with 18 possible investment projects in the Eastern Province. “It’s all about investment, and Sri Lanka is at a point where it can only get loans,” she told Ceylon Today. “I want to uplift the country through investment initiatives, not help or loans.”
Of the 18 proposals the Envoy and team had a look at were tourism project investment using Pulmoddai mineral sand that is available in the Eastern Coast of Sri Lanka.
It’s a single mission carried out by the Governor who had not shown the proposed investment to the Government for approval. “Should I need permission, I am the Governor and this is the first time we had this investment proposal ready to show it to any foreign envoys visiting me,” she added.
The Chinese Envoy on the other hand has taken a group of Chinese Business Chamber representatives possibly directly from China, as there is no Chinese Business Chamber in Sri Lanka. There is the Chinese Chamber of Commerce, Sri Lanka-China Business Council, Sri Lanka-China Business Cooperation Council, and China-Sri Lanka Association for Trade and Economic Cooperation (CSLATE).
According to the Chinese Embassy, Governor Yahampath co-chaired a business forum with Chinese Business Chamber representatives. An in-depth presentation on EP’s Prospectus was made. China encourages more investment to Sri Lanka including the Eastern Province to overcome current difficulties. Ambassador Zhenhong highlights a five-dimension assistance from China to Sri Lanka against the economic crisis, the Embassy had told the Easterners, and that a continued grant/ aid via various channels, fast-track ongoing projects and more FDI/Trade, bilateral debt settlement, support to Sri Lanka is under discussion with IMF and ISB, and tourism after Covid.
The Governor said for centuries mineral sand from Pullmoddai has been exported, but there should be value-added products to be imported as well. There is a large amount of titanium found in Pullmoddai and the Chinese had shown keen interest in that investment as well.
“One of the proposals focussed on boosting the fisheries industry and investment for value-added fish to be exported. Also, Ayurveda and hotel projects and land for it is in plenty,” she added.
“But the development proposals are based on my terms and not on their terms,” she said, adding that the land will not be leased for over 30-35 years according to her proposal.
She has also mentioned in the project proposal that the land would be offered by the people and not exceeding 50 to 100 acres for investment and the Chinese investor would work directly with the land owner and buy the product for which they would invest, for export.
Another potential Chinese investment was the production of castor oil for industrial use.
The investor had contacted the Eastern Province Governor for the second time. Generating employment and engaging the Eastern people in the investment project are her goals.
“There cannot be any geopolitical dispute, because it’s purely business,” she added.
“I did not have a project proposal to show others who had come to visit me. Envoys of The Netherlands, The United Kingdom, and Norway had visited in the last one year, however, it was meet and greet. This is the first time I had this proposal and the Chinese were shown. There is no point in just meeting and greeting.
She added that the Indian Envoy had visited the Eastern Province, but they did not meet her, and in the future she would show the proposals to them.
The Governor said she can get the Board of Investment to push for these projects to take shape. “I wish I could do that too. I heard at least 18 institutions need to grant permission before starting the project. I am not involved in that process, but I could only show the potential investments to investors,” she further added.
The Chinese Envoy visited Hindu, Muslim, and Christian places of worship in the East and supported the low-income families to overcome difficulties. Ambassador Zhenhong handed over food packs (worth Rs 5,200 each), donated by the people of Yunnan Province, to people in Trincomalee, Batticaloa, and Ampara.
In total, 10,400 underprivileged families in the Eastern Province have received support from the people of Yunnan. Ambassador Qi Zhenhong and Madam Jin Qian also donated a batch of sports equipment supporting local youth in Kalmunai.
The Sri Lankan administration has not commented on China’s “independent” visits to the North and East so far. There is no appreciation as well by the Government. The Indians on the other hand ensured that Sri Lanka noticed their presence.
The Eastern Province Governor’s investment ideas should be approved by the Government, possibly by the Foreign Ministry, because leasing land to China or doing business in the East will invariably result in diplomatic disputes and the Government has faced such a chaotic situation in the past. When the Chinese Government recently gave dry rations to the Foreign Ministry workers, it drew harsh criticism, and the staffers refused to accept the donations and told them to refrain from doing so.
But after the visit to the Eastern Province, China has progressed to send 512,640 syringes of life-saving Enoxaparin Sodium Injection worth RMB 10 million and the first tranche of RMB 500 million grant from the Chinese Government to Sri Lanka.
The Chinese Embassy in Colombo said it comes as joint efforts of all relevant authorities from both China and Sri Lanka.
Thus, two consignments are to be delivered to Sri Lanka, with one consignment of 256,320 syringes arriving yesterday (3) on flight CX3119, with a total volume of 40 cubic metres and weight of 4.3 metric tons.
The second consignment is expected to arrive in mid-June. The Chinese Embassy said Enoxaparin Sodium is an anticoagulant medication (blood thinner), commonly used to treat and prevent deep vein thrombosis (DVT) and pulmonary embolism (PE) including during pregnancy and following certain types of surgery. It is also used in those with acute coronary syndrome (ACS) and heart attacks, or during haemodialysis. The two consignments of 512,640 syringes donated by China will be sufficient for Sri Lanka’s use for 6 months.
“China relates deeply to the difficulties and challenges faced by the Sri Lankan people. The Chinese Embassy in Sri Lanka will continue to work closely with both Beijing and Colombo to follow through on the important agreement reached by the leaders of our two countries and provide much-needed livelihood assistance for Sri Lankan people as a top priority,” the Chinese Embassy added.
In Sri Lanka, the geopolitical tension between India and China appears to be higher than on the India-China border. India is completely focused on the current issue in Sri Lanka. China had been keeping a close eye on the situation until news broke that China had not adjusted the debt repayment for Sri Lanka. The Finance Ministry told Ceylon Today that converting the existing CNY 10 billion (roughly US$ 1.5 billion) swap facility secured from China into a conventional loan was challenging for Sri Lanka. According to reports, the Chinese authorities are hesitant to take any more action because the swap facility offered before 12 April may be subject to the newly auctioned foreign debt restructuring process.
One of the reasons for Sri Lanka’s debt default has been attributed to China. China’s ties have reached a critical juncture, with its political ties with Pakistan and Sri Lanka collapsing as their preferred politicians are ousted due to political turbulence. China wants to keep its Belt and Road Initiative afloat, but the financial burden, pandemic, and political upheaval in Southeast Asia has put their BRI to the test. The Chinese may have good intentions to reconcile with Sri Lankans in every conflict the two countries encounter, but there are other reasons for Sri Lanka to avoid needless disputes, and one of them is geopolitics.
By Sulochana Ramiah Mohan