One unassailable truth stands out that even if there is a change of Govt. in SL , it cannot disentangle itself from China’s economic trap..!!!

For China’s survival Fonseka or Mahinda ?....UPUL JOSEPH FERNANDO

It is evident that the China Xinhua Agency is very active these days in relation to the forthcoming Sri Lanka (SL) Presidential elections. The Agency is reporting a plethora of news about the Opposition common candidate General Sarath Fonseka. The Xinhua news which was reporting in favour of President Mahinda Rajapaksa suddenly did a ‘U’ turn and tried to publish news about Gen. Fonseka . This may be because China wants to secure an assurance that if Gen. Fonseka is installed as President , his Govt. will not impede or interfere with the existing on going projects of China in Sri Lanka (SL).
In any case China has no cause to get distraught or worried over Gen. Fonseka because the JVP which maintains cordial relations with China has come forward to support Gen. Fonseka. Hence , sources say , whether President Mahinda Rajapaksa wins or Gen. Fonseka emerges victorious will not make much difference to China.

Generally countries which provide aid to SL for its projects do not concern themselves much over a change of Government. Such aid provided by them for the projects are not linked with changes of government. These foreign countries give aid for projects in the form of soft loans or grants and continue with them irrespective of which government . is installed in power . Moreover , their aid is on conditions which are beneficial to SL without strings attached. Those countries do not derive any economic advantages out of the aid. Benefits accrue to SL. Therefore these countries have no worry over the subsequent governments coming into power , for they know the projects will continue uninterrupted , and they are identified by the SL government as aid projects.

But as far as China is concerned , its projects are not based on those lines , and therefore cannot be identified as such. Though these projects are recognized as aid projects by the SL government yet the Chinese projects do not conform to those norms. These projects are beneficial to China, The SL Government is a signatory to these projects advantageous to China. The best illustration of this is the joint SL – China Northern Railway project when compared with the Northern railways built under the Indian agreement where India is constructing 92 kilometers of rail track from Omanthai to Pallai, the cost of which is US Dollars 185 million ( approx. US$ 2 million per km).on a soft loan provided by India .

Whereas , China is constructing 56 Kms. of rail track from Pallai to Kankesanthurai at a cost of US $ 245 million ( more than US $ 4 million per Km !) and is on a loan at commercial rates from its EXIM Bank.

All Chinese projects are awarded to a Chinese agency., and it is this Chinese Agency which brings in the Chinese labour. There are no employment opportunities for the locals.

The sum total of the current Chinese investments (on ground and in pipeline ) is US $ 6.1 billion. Around 1000 Chinese labourers are here for a project costing US $ 200 million ( these figures are computed on the basis of the Chinese labour brought in for the Performing Arts Theatre , Colombo). Given this projection , there is on ground , already around US $ 5.1 billion China’s investment here . In other words , a minimum of 25, 000 Chinese are likely to enter SL by mid 2010 as labourers. Out of them , around 40% are prison labour force who will be paid less than what Sri Lankans get.

There are around 26000 Chinese workers mostly in white collar jobs in India. They are a cause for worry to India as they pose a threat to the security of India with a population of 1.1 billion.

SL is 60 times smaller than India . A labour force of 25000 Chinese , most of them blue collared can therefore pose a major problem. Apart from this , Beauty Parlors and restaurants/ Kiosks have proliferated . In 10 years time SL’s second language can well be Mandarin.

The Chinese are inflating all bids . This has happened with Road projects in the North. It is significant to note that the Chinese projects are not grants .They are commercial projects which are highly inflated to make allowance for kickbacks It is not creating livelihood in SL . A lot of money is re channeled into China via labor and import of machinery .

The Norocholai plant of 320 MW which is being set up by China is on a loan of US$ 455 million provided by it. The NTPC which is being set up at Sampur is on an investment of US$ 500 million by India . This is set up as a Joint Venture between NTPC and CED . There is a full stake in profit and loss for 20 years . Money has been raised in the market for same.

The foregoing comparison conveys a clear picture of the aims and objectives in the aid provided by China vis a vis other countries. In the circumstances , it can be fathomed why China is so deeply concerned about the Presidential elections . China’s anxiety is not in regard to who is the victor, but is based on its eagerness to learn who will be the President at the upcoming elections who will not interfere with these projects which are interspersed with conditions advantageous to China. For, if the projects are stalled or if the terms and conditions are revised in order to favor SL , China will certainly stand to lose.

Unlike other countries China does not venture to provide aid to countries where it cannot exploit an advantage. What is therefore most intriguing and dismaying is why the present govt. to paint a picture that these projects are China’s gifts while being fully aware that the conditions attaching to them are to China’s advantage . The Govt. has announced that China is helping to re build SL.. But , given the conditions on which the projects are aided , it is highly questionable whether China is helping to develop SL or to develop its own economy.

The Mahaweli project of SL which was developed on the aid of Sweden , Germany and Britain generated thousands and thousands of job opportunities for our youths. Under the Chinese projects employment opportunities are provided only to Chinese Nationals. In other words , in the final scenario of the Chinese projects , Chinese Nationals get employment , EXIM Bank of China prospers and exorbitant prices are collected by China on the supply of Chinese machineries and equipments.

Hence, it is no wonder the SL opposition is often justifiably questioning whether there exist kickbacks and under the counter benefits to Lankan politicos when these projects are being granted to China by this Govt. The Opposition clamor against these projects are justifiable on the basis that these have been granted by the Govt. despite it being fully aware that it is China which is overtly gaining on the conditions stipulated in the contracts.

Accusations are being levelled that politicians in African countries are given such kickbacks and under the counter payments by China while posing as though those projects are gifts to those Nations when in fact they are wrapped in conditions advantageous to China.

China is fully aware that like in SL , politicians of Asian and African countries are avaricious for money . It is China’s strategy to exploit this weakness prevalent in those countries and build its own economic Empire by infiltration. It is possible that the Leftist forces who clamor against foreign domination do not raise their voice against the latest China’s domination because China is their friend.

In the US Senate Committee on foreign relations report there is a comment made by the Science and Technology Minister when addressing the Committee members thus ,‘ we have only the USA to thank for pushing us close to China’. It is not clear whether the Left oriented LSSP Leader made this remark thanking the US for pushing SL towards China after evaluating the services rendered to the SL people or the gains acquired by him and his Govt .

At all events , one unassailable truth stands out that even if there is a change of Govt. in SL , it cannot disentangle itself from China’s economic trap.

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