Sri Lanka seems to be limping back to normal after the past tumultuous weeks which saw top government officials fleeing the country amid intense protests and rising calls for their resignation following the collapse of the economy. The past days have seen the launch of food distribution campaigns, introduction of a QR code system for fuel distribution, and fewer power outages. And according to reports, people in general agree that the new government should be given time to revive the economy.
That an International Monetary Fund team is visiting Sri Lanka from Aug 24 to 31 to discuss economic and financial reforms with the country's new government is another encouraging sign for the Sri Lankan economy. The IMF has said it hopes to make progress toward reaching a staff-level agreement with Sri Lanka on a prospective Extended Fund Facility in the near term.
But using the Sri Lankan crisis for their own gains, some Western politicians and media have blamed China for the collapse of the country's economy, saying China has provided Sri Lanka with opaque loan deals at higher interest rates than other lenders.
However, the truth is that all cooperation projects were implemented after scientific planning and thorough assessment, and without any political strings attached. Indeed, Sino-Sri Lankan cooperation has contributed to Sri Lanka's economy and brought tangible benefits to the Sri Lankan people.
More important, Sri Lanka's foreign debt is multifarious, with the debt to China (10 percent of the total) being far lower than that to the international capital market and development banks. Also, China has mostly extended preferential loans with low interest rates and long-term maturity, which have helped improve Sri Lanka's infrastructure and people's livelihoods.
In fact, shortly after Sri Lanka announced suspension of international debt payments, Chinese financial institutions approached the Sri Lankan side, saying they were ready to help it overcome the difficulties and stressing that a way to handle the matured debts will be found.
Perhaps the best response to Western attacks on China came from Sri Lankan writer Indrajit Samarajiva. In a commentary published in The New York Times on Aug 15, Samarajiva says: "The Western media accuses China of luring us into a debt trap. Tucker Carlson (TV host and conservative political commentator) says environmental, social and corporate governance programs killed us. Everybody blames the Rajapaksas, the corrupt political dynasty that ruled us until massive protests by angry Sri Lankans chased them out last month. But from where I'm standing, ultimate blame lies with the Western-dominated neoliberal system that keeps developing countries in a form of debt-fueled colonization. The system is in crisis, its foundations exposed by the tumbling dominoes of the Ukraine war, resulting in food and fuel scarcity, the pandemic and the looming insolvency and hunger rippling across the world."
Economies across the world, the global financial markets in particular, have suffered enormously due to the US' recent interest rate hikes and balance sheet reduction. Combined with its long-running quantitative easing policy and massive stimulus packages to boost the US economy, the rate hikes have dealt a devastating blow to the developing and emerging economies.
Also, the US' wayward sanctions and tariff barriers have undermined global industry and supply chains, and caused food and energy prices to surge, making life even more difficult for millions of people across the globe and worsening the financial condition of developing countries such as Sri Lanka. Indeed, the US-led manipulation of the credit rating of Sri Lanka seriously undermined the country's financing credibility and channels.
The US should ask itself: What has it done for developing countries such as Sri Lanka? And what harm have the US' economic, financial and foreign policies caused to other countries?
We hope the US will ease debt burden of Sri Lanka, instead of unscrupulously exploiting every opportunity to shift the blame to other countries. For it is not fair to blame China for underperforming investments. For example, the Hambantota port's failure can be attributed to Sri Lanka's lack of market power, marketing skills, technological expertise in international financing, and a global cooperation network. In fact, since China Merchants Port Holdings Company took over its operation in 2017, the port has seen remarkable growth.
Several manufacturing enterprises are being established in the Hambantota Port Industrial Park including Sea-Horse Yachts' $58 million yacht-building factory, Shenzhen Xinji Group's $15 million plug-and-play parkin-park facility, and Shandong Haohua Tire Co's $300 million tire manufacturing plant.
Sri Lanka also has many Belt and Road Initiative projects, including the Colombo-Katunayake Expressway, Southern Expressway, Outer Circular Highway, the Hambantota port, Bunkering Facility and Tank Farm in Hambantota, Hambantota Port Industrial Zone Project, Reconstructed Kandy-Jaffna A9 Road, Mattala Airport in Hambantota, Norocholai Puttalam Lakvijaya Power Plant, Colombo International Container Terminals, Matara-Kataragama Railway Extension, and the Water Supply and Sewerage Project in Greater Kurunegala. Which have brought many benefits to Sri Lanka.
Moreover, China has fully financed the construction of prominent landmarks such as the Bandaranaike Memorial International Conference Hall, the Bandaranaike Centre for International Studies building, the Supreme Court of Sri Lanka complex, a nine-story wing at Lady Ridgeway Hospital and the National Nephrology Specialist Hospital.
Even though Japanese contractor Taisei Corporation Sri Lanka Ltd has suspended the Terminal 2 construction of the Bandaranaike International Airport Development Project Stage 2 until the finalization of Sri Lanka's debt restructuring process, the Metallurgical Corporation of China has agreed to discuss the funding further at the next meeting to proceed with the long-delayed construction of the phase two of the Central Expressway stage three.
People have seen tangible changes, including creation of many new jobs, through Belt and Road projects thanks to the improvement in infrastructure. In short, China has always been a reliable friend and partner of Sri Lanka and their friendly relationship benefits the development of both countries and serves the fundamental interests of people on both sides.
The author is director of Belt and Road Initiative Sri Lanka, an independent and pioneering Sri Lankan-led organization, which specializes in BRI advice and support.
The views don't necessarily reflect those of China Daily.