Unsustainable debt burdens

By Yi Xianliang: Chinese Ambassador to Sri Lanka.        

Profound and complex changes are taking place in the current world regarding geopolitical and economic circumstances, with opportunities and challenges driving ahead. During the 19th National Congress of the Communist Party of China, Chinese President H.E. Xi Jinping called on the people of all countries to work together with other friendly countries toward a new form of international relations featuring mutual respect, fairness, justice, and win-win cooperation and a community with a shared future for mankind, and work together with the people of all countries to build an open, inclusive, clean, and beautiful world that enjoys lasting peace, universal security, and common prosperity. Every country should respect each other, discuss issues as equals, resolutely reject the cold war mentality and power politics, and take a new approach to develop state-to-state relations with communication, not confrontation, and partnership, not alliance. Indian Ocean Region (IOR) keeps a good momentum while immense unsteadiness and uncertainties parasitize. China has always devoted itself to safeguarding peace and stability of IOR and promoting common development for IOR featuring harmony, cooperation and win-win result. China insists on that inclusive cooperation is the sole path for a bright future of IOR.

Ⅰ. Carrying Forward the Thousand-Year Silk Road

Thousands of years ago, China and Indian Ocean (IOR) countries started cultural exchanges and trade. Throughout history, the Chinese civilization reached the world and Chinese learned from the outside world by its endless fleet of ships, resulting in the ‘Maritime Silk Road’, which benefited generations by generations with its connectivity. The Ancient Maritime Silk Road founded itself the artery of transportation for Asia, Europe and Africa. Faced with harsh conditions, countless envoys, monks and dealers of dynasties made their way to the West on this artery to learn and to trade. Therefore, the abundant products and advanced production tools were introduced to IO countries. Moreover, the Chinese civilization including Confucius thoughts, laws and regulations, clothing, plantation, architecture and relevant technologies reached the IO coast, which propelled its economic development and social progress. Meanwhile, Buddhism, agro-products and crafts from IOR, were introduced to China along the Silk Road. The long-standing trade, culture and people-to-people exchanges never ceased away but were renewed with long time river. More than 600 years ago, Chinese navigator Zheng He, heading fleets of over 200 ships and 27,000 crew members, traveled to the West Pacific and IO for 7 times and made himself a legend in this Region. The giant fleets visited more than 30 countries including Sri Lanka, India and Kenya. Zheng He stayed in Sri Lanka as Envoy for 5 times. The voyage of Zheng He largely deepened relations between China and Southeast Asia, South Asia, Central East and African countries. Since the fleet of Zheng He experienced a few fights against the pirates, they enjoyed generally freedom and security of navigation in most time of their voyages.

Ⅱ.Deepening Cooperation and Bound together by a Common Cause

Under the context of globalization, IOR in some sense has ever become one of the global prosperous centers. Moreover, South Asia becoming the most promising Sub-Continent in the 21st century. Fortunately, Alfred Thayer Mahan’s prediction made in 1890 that “Whoever controls the Indian Ocean will dominate Asia” might not be realized, because no one could dominate the IO and common development and sharing are the main trend which will be sustained.

With a vast territory, China shares borders with 5 countries from South Asia and most southwest provinces of China hold intimate geographical ties with South Asian countries and deeper and longer linkage with their South Asia neighbors than with eastern Asian countries. Being not only the good neighbor and friend of inter-dependent and mutual support for South Asia countries, China is inseparable for South Asia and IRO. Future and destiny of China and IO countries are closely linked together. Viewing from this perspective, China is definitely part of South Asia and IO.

Since 2014, H.E. Xi Jinping, President of the People’s Republic of China, made historic visits to South Asian countries including Sri Lanka, Maldive, Bangladesh and Pakistan, starting a new chapter for good neighborly and friendly relations. China has ever deepened practical cooperation with South Asia countries in the field of sustainable development, trade and economic cooperation, people-to-people exchanges, combating pirates, alleviating poverty and disaster relief, etc. Trading volume between China and South Asian countries witnessed a rapid growth, which reached 110.7 billion USD in 2016, accounting for 3.2% of total trading volume for China with the world. In recent 5 years, China has provided more than 10,000 scholarships and training opportunities for South Asia countries. Referring to Sri Lanka, China provided 1,300 scholarships and training opportunities in 2015, 1500 in 2016 and this figure has exceeded 2000 for 2017. For a consecutive of 3 years, Sri Lanka received more foreign-aid training resources from China than any other country.

China is a great trade power. Nearly 40% of its foreign trade goods has to transport through Indian Ocean shipping line. Each year, more than 5,000 merchant ships depart from China or travel to China through the route, navigating around South Asia, the Middle East, Africa and Europe. Safeguarding the freedom of navigation and security in the Indian Ocean are major interests and concerns of China.

China stands as a major force for the development, peace and stability in the Indian Ocean Region. China actively participates in the UN’s escort missions and anti-piracy operations in the Gulf of Aden. By 2016, China has dispatched 25 batches of naval fleets, 78 vessels, 54 helicopters and 21,000 people to conduct escort missions for about 6,300 Chinese and foreign passing ships. China successfully rescued over 60 vessels in distress by then. It fully embodies China’s effective exercise of maintaining freedom of navigation and security and the responsibility of major power. China shares the common fate with the regional countries consistently. China is also an active member of ReCAAP (Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia) which covers more than 30 countries along the Indo-Pacific Region including ASEAN nations, Australia, Sri Lanka, Japan, Korea, India, Pakistan, Denmark, Netherlands, UK, US and etc,. As the China’s Governor of the ReCAAP, I envisioned the cooperation on combating piracy and safeguard the navigation freedom in Indian Ocean. As one of the vital users of the Indian Ocean shipping lane, China has proved that no country is more eager than China to maintain a peaceful and secure, united and cooperative, and prosperous Indian Ocean family. China will continue its commitment to enhance relations with countries in the Indian Ocean region, making positive contributions to promoting regional peace, stability and prosperity.

Soon after the 2004 Indian Ocean tsunami, Chinese government provided humanitarian emergency assistance to the affected countries along the Indian Ocean coast, donating CNY 522 million (Rs. 12 billion) in total and sending medical rescue teams and professional rescue units to help the affected countries to carry out rescue and reconstruction. Chinese society and public also donated CNY 290 million (Rs. 6.6 billion) to the victims in the disaster areas. For the past 2 years, China has provided a great deal of assistance for the drought and floods in Sri Lanka every year, amounting to Rs. 940 million, and committed itself to the reconstruction.

I noticed seriously that Ms. Alice Wells, Acting Assistant Secretary of the State of the United States, recently claimed in the Congress that unsustainable debt burdens for Sri Lanka were made out of Chinese non-concessional loans. It is completely unfounded statement. Instead, she stated that the United States was the largest grant provider of assistance to Sri Lanka. In fact, most of Chinese loans to Sri Lanka are concessional, with a fixed rate of 2.0%, and Chinese government has to provide a large amount of financial subsidies on interest payment. China’s concessional loans support projects including hydro-projects, power plants, roads, railways, ports, airports and other infrastructure building, playing an important role for the economic and social development of Sri Lanka. As a developing country, China has done its utmost to help developing countries through bilateral cooperation and South-South cooperation mechanisms. Since the establishment of diplomatic relations, China’s total assistance to Sri Lanka has amounted to more than CNY 10 billions (Rs.220 billion). From 2014 to 2017, China offered CNY 1.5 billion (Rs.33 billion) as aid given gratis to Sri Lanka, and China will offer CNY 2 billion (Rs.47 billion) to Sri Lanka from 2018 to 2020. The Chinese granted projects, such as Bandaranaike Memorial International Conference Hall, Nelum Pokuna Theater, Kidney disease hospital, Cancer funds etc., serve Sri Lanka society and public well and for sure, it is obvious to all. China always respects Sri Lanka’s sovereignty and internal affairs, offering aid given gratis without any attached political conditions, only requiring it to be used for people’s livelihood and benefit the general public as much as possible. According to the United Nations resolution, developed countries are urged to donate their 0.7% of GDP on providing assistance to developing countries. In fact, most countries, except some European countries like the Netherlands, Denmark and Norway, did not fulfill their obligations. Chinese people are most against those who are rich but not benevolent, and Chinese culture promotes “kindness, harmony and relief”. China will continue to do what we can and what we promise, in helping developing countries including Sri Lanka, in the way of action rather than ‘ Carrots plus Sticks’ or talking approach.

III. Shouldering Its Own Responsibility to Achieve Mutual Benefits and Common Development

China’s peace and development is closely related to the future of the Indian Ocean region. China always insists on the neighboring foreign policy of ‘building friendship and partnership with neighboring countries’, upholds the concept of win-win cooperation while respecting the countries of the Indian Ocean region to choose their own path of development. We will to consolidate dialogue and cooperation on regional security and jointly maintain peace and stability in the Indian Ocean region.

China is one of the biggest beneficiaries of globalization and also a strong advocate for globalization. In the process of globalization, China adheres to the path of peaceful development and resolutely resists cold war mentality and zero-sum game. We stand for innovation of concepts for security in the Indian Ocean region to improve the regional security architecture and explore new ways to safeguard the security of the Indian Ocean region under the rules and guidance of United Nations’ and its bodies concerned.

In May 2014, Chinese President H.E. Xi Jinping, put forward the Concept of ‘Common, Comprehensive, Cooperative and Sustainable Security’. China advocates and devotes to jointly build a road for security of Asia-Pacific that is shared by and win-win to all. This concept not only complies with the trend of globalization and peace, development, cooperation and mutual benefit, but also opens up new broad prospects for security cooperation in the Indian Ocean region. We respect and ensure the security of every country regardless of size. While tackling the immediate security challenges facing the region, we should also make plans for addressing potential security threats, and avoid a fragmented and palliative approach that only treats the symptoms. We need to promote the security of both individual countries and the region as a whole through dialogue and cooperation. As a Chinese proverb says, “Strength does not come from the muscle of the arms, but from the unison of the heart.” We should engage in sincere and in-depth dialogue and communication to increase strategic mutual trust, reduce mutual misunderstanding, seek common ground while resolving differences and live in harmony with each other. Development and security should be both focused so that security would be durable. We need to advance the process of common development and regional integration, foster sound interactions and synchronized progress of regional economic cooperation and security cooperation, and promote sustainable security through sustainable development.

China is an active practitioner of this security concept and is always committed to maintaining peace and stability in the Asia-Pacific region. China is devoted to resolve disputes over territorial and maritime rights and interests through friendly consultations and negotiations with countries directly concerned. However, some countries outside the region continuously expand their military presence in the South China Sea and try everything to stir up troubles everywhere and mess up the South China Sea Issues in order to serve their own strategic interests. It has brought problems to coastal countries of the South China Sea, and even made some specific coastal states lost their own way and fell into the trap. Someone said the Indian Ocean might be the next South China Sea and people need to keep vigilant. Indeed, we domain countries need to keep vigilant against some outside countries’ continuous expansion of military presence in the Indian Ocean and their disturbance to the regional order. People should prevent the wolves from entering in homeland, introducing new cold war and creating new powder keg, to undermine existing peace and stability in the region.

The long-term stability of the Indian Ocean region depends on the security architecture that serves the fundamental interest of the regional countries. The Indian Ocean belongs to the world but more to the countries of the region. China is committed to promote the security architecture which every regional country could participate in equally and serves the interest of all on the basis of consensus, thus contributing to regional security and stability.

IV. Making Concerted Efforts to Achieve Promising Future

In context of the deep adjustment of the world economy, China follows the call of the times and come up with the ‘Belt and Road Initiative’ (BRI). Deep-rooted in history, the BRI focuses on the present and faces up to the future to make the glory of the ancient silk road shine again. BRI is an initiative to promote economic development, social progress and cultural exchanges, which brings more and more opportunities for the development of the Indian Ocean region and South Asian countries. In the recent four years since the initiation of BRI, friendly cooperation between China and South Asian countries has developed rapidly and harvested a lot. Asian Infrastructure Investment Bank (AIIB) and the Silk Road Fund have been well facilitating the development of BRI projects in the Indian Ocean Countries. These years, the cooperation between China and the Indian Ocean coastal countries has been increasingly deepened. Our economy have been integrated through opening up and rapidly developed through integration, moving towards a sound situation of policy connectivity, infrastructure connectivity, trade connectivity, financial connectivity and people-to-people connectivity.

I was surprised to hear that some third country Ambassador said his country was against a particular country using a port exclusively in another country while referring to Hambantota Port recently. According to the agreement signed between a Chinese company and Sri Lanka Port Authority, the two sides will establish two joint ventures to operate the port. And it is common sense that a port will never be exclusively used or operated. Hambantota Port just like other ports in the world, is open to ships of all countries. I have to emphasize that the BRI is an open and inclusive initiative. BRI originates in China, but belongs to the world and has delivered benefits well beyond its border. Sri Lanka is a traditional friendly neighbor of China and also a supporter and participant of BRI. Currently, Colombo Financial City (Port City) has resumed its construction and processes smoothly. In order to support the concept and idea of financial hub raised by Sri Lanka Government, Bank of China has set up its branch for South Asia in Colombo. The Hambantota port agreement has been signed and the port will be operated making Sri Lanka the shipping and logistic hub in the region. Projects including water supplies, LNG power plant, railways, highways etc., are steadily forging ahead under the BRI framework. Unlike some big powers, China-Sri Lanka cooperation doesn’t include any hidden agenda. China has never sought to monopolize ports or any industry in other countries. We always adopt an open, inclusive and win-win way which contribute to the development and prosperity of Sri Lanka. China welcomes any third country to join in the BRI, participate in the project construction by China and countries along the routes and share the cooperative development achievement at any time.

The pursuit of the BRI is not meant to reinvent the wheel. Rather, it aims to complement the development strategies of countries involved by leveraging their comparative strengths. It is in line with various development visions and plans of countries in the Indian Ocean region. We are looking forward to promoting complementarity between China’s development plan and those of other countries and building closer cooperative partnerships, thus making China’s development benefit more Indian Ocean countries. We are willing to work together with other countries to create a bright future for the Indian Ocean. (FT)

Leave a Reply

Your email address will not be published. Required fields are marked *