• Tuesday, Jan 31, 2023
  • Last Update : 09:54 am

Sri Lanka gets $300m Chinese factory near key port

  • Published at 12:24 pm December 8th, 2020
Colombo
File photo: A general view of a Chinese-funded project for Port City is pictured, in Colombo on November 10 2020 AFP

The announcement came just weeks after Prime Minister Mahinda Rajapaksa unveiled the country's 2021 budget

Sri Lanka announced Tuesday the first large-scale Chinese investment in manufacturing in the country, a $300-million tyre factory near a strategic deep-sea port.

Western nations, as well as regional power India, have long been concerned about Chinese influence in Sri Lanka through projects under its gargantuan Belt and Road infrastructure initiative.

The factory will be adjacent to the Hambantota port, which was leased to a Chinese company in 2017 after Sri Lanka failed to service the $1.4-billion debt from Beijing used to build it.

Sri Lanka's cabinet approved the setting up of the tyre plant under legislation that allows generous tax concessions, Media Minister Keheliya Rambukwella told reporters in Colombo.

He said Shandong Haohua Tire Co Limited will export at least 80% of production, with the option of selling the rest on the local market.

The announcement came just weeks after Prime Minister Mahinda Rajapaksa unveiled the country's 2021 budget, banking on a huge Chinese real-estate development in Colombo to attract more investment and revive the island's economy.

The Colombo Port City -- a $1.4 billion land reclamation project which started in 2014 -- has doubled the size of Sri Lanka's current financial district.

When Rajapaksa was president between 2005-15, Colombo borrowed billions from China, accumulating a mountain of debt for a string of infrastructure projects -- including an international airport dubbed "the world's emptiest" by media for its lack of flights.

He and his brother Gotabaya Rajapaksa -- the current president -- have rejected accusations that many such projects are white elephants, and have denied falling victim to a Chinese debt trap.

With credit agencies cutting Sri Lanka's debt ratings, the country is expecting more Chinese loans in the new year.

Its economy is struggling with both the coronavirus pandemic and the devastating effect the Easter Sunday bombings last year had on the tourism industry.

50
Facebook 50
blogger sharing button blogger
buffer sharing button buffer
diaspora sharing button diaspora
digg sharing button digg
douban sharing button douban
email sharing button email
evernote sharing button evernote
flipboard sharing button flipboard
pocket sharing button getpocket
github sharing button github
gmail sharing button gmail
googlebookmarks sharing button googlebookmarks
hackernews sharing button hackernews
instapaper sharing button instapaper
line sharing button line
linkedin sharing button linkedin
livejournal sharing button livejournal
mailru sharing button mailru
medium sharing button medium
meneame sharing button meneame
messenger sharing button messenger
odnoklassniki sharing button odnoklassniki
pinterest sharing button pinterest
print sharing button print
qzone sharing button qzone
reddit sharing button reddit
refind sharing button refind
renren sharing button renren
skype sharing button skype
snapchat sharing button snapchat
surfingbird sharing button surfingbird
telegram sharing button telegram
tumblr sharing button tumblr
twitter sharing button twitter
vk sharing button vk
wechat sharing button wechat
weibo sharing button weibo
whatsapp sharing button whatsapp
wordpress sharing button wordpress
xing sharing button xing
yahoomail sharing button yahoomail