China To Develop Strategic Hambantota Port, Colombo Airport, Says Sri Lanka PM Gunawardena

The southern seaport of Hambantota was handed to a Chinese state-owned company in 2017 on a 99-year lease for US$1.12 billion, sparking security concerns in India.

Colombo: Sri Lanka’s Prime Minister, Dinesh Gunawardena, announced on Wednesday that China has committed to enhancing the development of the island nation’s crucial deep sea port and the airport in the capital city, following productive discussions with his Chinese counterpart in Beijing. China, being Sri Lanka’s primary bilateral creditor, has pledged to support the country in restructuring its external debt, a critical step towards securing a $2.9 billion IMF bailout.

In 2022, Sri Lanka faced a severe foreign exchange crisis, leading to a sovereign default on its substantial $46 billion foreign debt. The economic turmoil triggered widespread protests, ultimately resulting in the resignation of then-president Gotabaya Rajapaksa. The assurance of China’s assistance in infrastructure development and debt restructuring comes as a significant relief for Sri Lanka.

According to AFP, Gunawardena’s office said Premier Li Qiang had promised China would “assist Sri Lanka’s debt restructuring process continuously and help Sri Lanka to develop its economy”. He said that  Beijing had offered “assistance to develop” Colombo International Airport and Hambantota port, the statement added, without giving further details.