The new Government of Sri Lanka announced that it is keen to cancel its participation in China’s Belt and Road Initiative, cancelling the previous’ government’s move to lease the southern port of Hambantota to state-backed China Merchants.
Two years ago, the previous government leased the development of port Hambantota to China Merchants Port Holdings Co, meaning that the latter would handle the port for 99 years in return for US$1.1 billion (S$1.5 billion).
Today, Sri Lanka’s government led by President Gotabaya Rajapaksa highlighted that the port should be given back to the country.
Specifically, Ajith Nivard Cabraal, a former central bank governor and an economic adviser to prime minister Mahinda Rajapaksa reported to Bloomberg that the ideal process would be that the Government pays its debt in due course, and China gives the port back.
In the meantime, China’s Foreign Ministry issued a statement according to which “China-Sri Lanka cooperation, including the Hambantota port project, are built on the basis of equality and consultation”. This means that China is reluctant to give the port back.
