China Asks Sri Lanka to Protect Its Investments

China today asked Sri Lanka to protect the interests of Chinese investors for "healthy development" of economic and trade ties after the new Sri Lankan government began reviewing the big ticket investments, specially the China-funded USD 1.5 billion Colombo Port City project.

"We hope the Sri Lankan government will resolve the issue and protect the legitimate interests of Chinese investors according to law for healthy development of economic and trade ties," said China's Commerce Ministry spokesperson Shen Danyang.

The Sri Lankan government announced earlier this month that it has suspended the USD 1.5 billion Chinese project in Colombo and is reevaluating the deal.

Stakeholders were reportedly concerned over environmental standards and a lack of transparency, state-run Xinhua news agency said.

The project was regarded key for China's plans to build Maritime Silk Road (MSR) in the Indian Ocean.
   
The project would be probably discussed when Sri Lankan President Maithripala Sirisena visits China next week.

Sri Lankan Finance Minister Ravi Karunanyake would visit China to discuss the prospects of renegotiating the USD 5 billion loans whose interest rates are considered exorbitant by the new Lankan government. The loans were acquired by previous President Mahinda Rajapaksa regime.

Under the deal, China Communications Construction would reclaim 575.7 acres of land off Colombo. Of this, 266.8 acres would be given to CCCC.

CCCC said that it is suffering a loss of USD 3.80 lakh per day due to the suspension of the work.

After Sirisena took office in January, the new government decided to re-examine the port project and reconsider the outright transfer of a parcel of land to China under the deal, the report said.