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Dec 04 2020
China-Sri Lanka Cooperation during the Post COVID-19 Era
By Liu Youfa

Amidst the rampage of COVID-19, countries on the subcontinent of South Asia and around the Indian Ocean are faced with the volatile political, economic and security situation, punctuated by the big power rivalry, border conflicts, surging non-traditional security risks, and the pending national reconciliation and rehabilitation when the US should withdraw its troops from Afghanistan. More importantly, the whole world is under the pending pressure of the economic downturn of the global economy. Against the above backdrop, China and Sri Lanka have more reasons to join hands and carry out the consensus to promote common development by our national leaders, and carry forward closer cooperation, in line with the principle of partnership on equal footing and win-win outcome. I’ll focus my presentation on five areas of cooperation, their current status and the way forward.

The first area of cooperation is pandemic management. The on-going COVID-19, which has been rampaging across the world, has put our two countries in the same boat in the field of public health management.Right now, both countries are faced with the possibility of the second wave of the pandemic which has become the latest platform for the bilateral cooperation. To be specific, our two countries should carry out more cooperation in terms of the effective drugs and vaccine to fight against the pandemic, and the closer cooperation in the prevention of the deadly disease. We should establish an information exchange institution, we should carry out more exchange programs on doctors, nurses and health official. One thing is for sure, President Xi Jinping has announced at the latest G20 summit that China would share vaccines with the neighboring countries and the BRI partner countries, which Sri Lanka would be able to take stock from. Currently, out of the 11 vaccines that are undergoing Stage III test, China has four, in accordance with the WTO standards.

The second area is the cooperation on port city construction. You wouldn’t believe it, but the bilateral cooperation between China and Sri Lanka has been one success story under the Belt and Road Initiative. As I recall, President Xi Jinping said when he met with President Mahinda Rajapaksa, that Sri Lanka is an important partner in building the Maritime Silk Road in the 21st century. He also said that the two sides should focus on promoting maritime economy, port construction and maritime security cooperation to achieve results as soon as possible. I’m pleased to say that the visions by the two leaders coming into reality. For one thing, Port City Colombo has become the flagship project, which is becoming a brand-new city emerging literally from the sand beaches. As an extension of the Central Business District of Sri Lanka’s vibrant commercial capital, Colombo, it issoon to become an attractive residential, retail and business destination, offering unmatched planned city living along the warm waters of the Indian Ocean. Colombo Port is a rapidly growing maritime hub of the South Asia Region. Cargo originating from and destined to Europe, East and South Asia, the Persian Gulf, and East Africa is conveniently and efficiently connected through the Colombo Port. The Colombo Port is primarily a container port. The key issue now is to step up the joint efforts in terms of providing service in line with the international standards, in order attract more FDI owners to come in and ley their economic eggs.

The third area of cooperation is industrial park joint construction. According to the agreement between our two governments, the Hambantota Industrial Park will eventually cover an area of 50 square kilometers. For a start, the industrial park will serve as the commercial and logistics industry center, focusing on marine services, marine products processing, agricultural product processing and other processing. In the long run, the Hambantota Industrial Park is to attract more and more domestic and overseas investors to establish manufacturing enterprises which is to create hundreds of jobs directly and indirectly, contributing greatly financially to the local and national governments. And, it’s set to become the main engine for the overall development of southern Sri Lanka and eventually to give a facelift to the capital city of Columbo.It is also expected that the whole complex will transform Hanbantota complex into a "Shenzhen" of Sri Lanka. For that matter, the leaders and governments of both countries must give constant guidance to the bilateral cooperation irrespective of the party politics and the general elections.

The fourth is the cooperation in infrastructure under the BRI frame work. China and Sri Lanka have been very successful in carrying out cooperation in nation-wide infrastructure construction. Right now, the two flagship projects are in near completion. One is Hanbantota complex, and the other is the Columbo Port City. When both complexes are in full operation, they are set to boost the national transportation networks, provide steam for patching up the isolated regional markets into the national market, which is the precondition for the sustainable national economic development, up-grade the national industrial structure, contribute to the bulk of the national revenue, boost the scale of national economy and greatly improve the living standards of the local population, enhance the competitiveness of Sri Lanka's ports in South Asia, and eventually help put Sri Lanka into the world map as a fast developing nation. The key issue is that the two governments must further design and implement policies to encourage enterprises  of both sides to step up the joint effort to extend the public transportation networks across the country and connect the isolated road systems and markets so that more people from inland areas would benefit from the joint construction, and help them to realize the 2030 Development Goals by the United Nations.

Last but not least is the industrial cooperation. The bilateral trade volume is still low as compared with the cordial relations between our two countries. In 2019, China-Sri Kong trade volume stood at US$4.49 billion, with heavy trade deficit on the Sri Lankan side. In 2019, Chinese companies invested US$260 million in Sri, up 149.1% year-on-year, which still leaves more space for expansion. In the field of engineering contracting, in 2019, Chinese enterprises signed new contracts in Sri Lanka with a total contract volume of US$2.79 billion, which was down 23.2% YoY. From my personal perspective, our two countries should carry out more industrial cooperation in textile industry, tourism, food and vegetable farming, tea cultivation and marketing, animal husbandry, fishing, manufacturing industries, in line with the comparative advantages of both sides. All these areas would help cement the economic and social foundation for the bilateral relations to move forward far and steady.

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