Submitted by Wagamaga t3_123jqet in technology
Comfortable_Excuse41 t1_jdvxfc9 wrote
Reply to comment by BrownMan65 in China Energy proposes $1bn floating solar farm In Zimbabwe by Wagamaga
Does the address the current state of Sri Lanka
BrownMan65 t1_jdvyeg1 wrote
>Our research shows that Chinese banks are willing to restructure the terms of existing loans and have never actually seized an asset from any country, much less the port of Hambantota.
>In Hambantota, instead of waiting for phase 1 of the port to generate revenue as the Ramboll team had recommended, Mahinda Rajapaksa pushed ahead with phase 2, transforming Hambantota into a container port. In 2012, Sri Lanka borrowed another $757 million from China Eximbank, this time at a reduced, post-financial-crisis interest rate of 2 percent. Rajapaksa took the liberty of naming the port after himself.
>When Sirisena took office, Sri Lanka owed more to Japan, the World Bank, and the Asian Development Bank than to China. Of the $4.5 billion in debt service Sri Lanka would pay in 2017, only 5 percent was because of Hambantota.
Yes. The current state of Sri Lanka is due to shitty leadership and even shittier loans from basically everyone but China.
Comfortable_Excuse41 t1_jdw296g wrote
China knowingly lent money to a country who the had the in abilities to payback. I wonder how they got the hambo port
BrownMan65 t1_jdw2y0h wrote
>When Sirisena took office, Sri Lanka owed more to Japan, the World Bank, and the Asian Development Bank than to China. Of the $4.5 billion in debt service Sri Lanka would pay in 2017, only 5 percent was because of Hambantota.
Are you just knowingly not reading the article or the parts that I quoted? You're seriously mad at China for loaning money at a lower interest rate than every other country that loaned them money? Also their total debt to China is less than every other country. It's so obvious that you're just looking for any reason to hate on China instead of actual dealing with reality.
Comfortable_Excuse41 t1_jdwjtay wrote
It does not have lower interest rates then the IMF. The reason they couldn’t secure a loan from the IMF. The IMF required Sri Lanka to have a series of reforms to manage their deficit. The IMF knew they wouldn’t able to pay back without a series of reform. Only a predatory entity would lend to a government who can’t back, maybe it’s coincidence China got the 99 lease on the port.
BrownMan65 t1_jdwqi6h wrote
https://data.imf.org/regular.aspx?key=61545855
You can search up Sri Lanka and find the interest rates that the IMF is charging them as well as other countries. You're literally just making up lies at this point.
https://www.imf.org/external/np/fin/tad/extarr2.aspx?memberKey1=895&date1key=2018-09-30
Here's all the times the IMF lent money to Sri Lanka. The latest was in 2016 but I'm sure that's totally not predatory at all.
Also here you go again, not reading the link I sent from The Atlantic. The article even states that other countries were asked first to help build the port. A Canadian and later Danish company were even contracted to do feasibility studies. They took this information and approached the US and India to help fund the construction of the port and both said no. Eventually a Chinese construction company won the bid and a Chinese bank agreed to fund the project.
>The Canadian project failed to move forward, mostly because of the vicissitudes of Sri Lankan politics
>We reviewed a second feasibility report, produced in 2006 by the Danish engineering firm Ramboll, that made similar recommendations to the plans put forward by SNC-Lavalin
>Armed with the Ramboll report, Sri Lanka’s government approached the United States and India; both countries said no. But a Chinese construction firm, China Harbor Group, had learned about Colombo’s hopes, and lobbied hard for the project. China Eximbank agreed to fund it, and China Harbor won the contract.
All you have to do is read. I gave you all your answers and you still continue to just be completely wrong. At this point it has to be on purpose.
Here's the most important part that you should probably come to understand though.
>The Central Bank governors under both Rajapaksa and Sirisena do not agree on much, but they both told us that Hambantota, and Chinese finance in general, was not the source of the country’s financial distress.
>Before the port episode, “Sri Lanka could sink into the Indian Ocean and most of the Western world wouldn’t notice,” Subhashini Abeysinghe, research director at Verité Research, an independent Colombo-based think tank, told us. Suddenly, the island nation featured prominently in foreign-policy speeches in Washington. Pence voiced worry that Hambantota could become a “forward military base” for China.
You and every other western person only gives a shit about Sri Lanka because China helped build a port that the rest of the world refused to help them with. If the US had built that port and the exact same circumstances had happened, you wouldn't have batted an eye. You would be here blaming their government for their mismanagement of the country. Instead you're blaming China because you've bought into the bullshit propaganda about Chinese debt trap diplomacy and believe that China is out to get you.
Comfortable_Excuse41 t1_jdwspr4 wrote
You realize the port wasn’t feasible right. Feasibility studies were done. China knew it, but still funded it. Once the Sri Lanka government realized they couldn’t repay the debt they were forced to privatize it. China funded, china owns the debt, and a Chinese State enterprise owns the port.
BrownMan65 t1_jdwtdef wrote
> It was the Canadian International Development Agency—not China—that financed Canada’s leading engineering and construction firm, SNC-Lavalin, to carry out a feasibility study for the port. We obtained more than 1,000 pages of documents detailing this effort through a Freedom of Information Act request. The study, concluded in 2003, confirmed that building the port at Hambantota was feasible
>We reviewed a second feasibility report, produced in 2006 by the Danish engineering firm Ramboll, that made similar recommendations to the plans put forward by SNC-Lavalin
Please shut up. You're too stupid for your own good.
Comfortable_Excuse41 t1_jdwu66e wrote
CIDA proposed it could be done in 3 phases in 2002 for 1.7 billion. It never came to fruition. The port proceeded in two phases by Chinese backed loans. The first phase and second being funded by Exim Bank of China.
BrownMan65 t1_jdwv9hs wrote
>In Hambantota, instead of waiting for phase 1 of the port to generate revenue as the Ramboll team had recommended, Mahinda Rajapaksa pushed ahead with phase 2, transforming Hambantota into a container port.
The President of Sri Lanka pushed for the second phase to begin immediately before phase 1 could begin to generate revenue which ballooned the country's debt. Again, I'm not sure how you can blame China for this.
Comfortable_Excuse41 t1_jdwwhji wrote
Construction phase 1 didn’t begin until 2007 and finished around 2010. Second phase didn’t begin until 2012 and funded Exim with the agreement that China merchant port would get 65 percent stake for 35 years . Jesus I wonder why they couldnt pay back the loan.
BrownMan65 t1_jdx1r2y wrote
They couldn't pay back the loan because they literally did not take the time to allow phase 1 to bring in revenue. Just because it was completed in 2010 does not mean that shipping lines are immediately established with the new port in mind. It takes time for things like that to change and before that could happen, phase 2 was started. What do you think happens when you have a loan that you haven't made progress on and then take out a second loan that is over 2x more than the first one? It's not really a crazy concept here and is a failing of the Sri Lankan government.
On top of that, the loan did not come with an agreement for China Merchant Port to take 65% stake. Sri Lanka sold part of their stake to the company in 2017 as a means of paying down their debt. The loan that Sri Lanka took from Exim even came with a post crisis interest rate of 2%, nearly 5x lower than anything the IMF has offered Sri Lanka.
Comfortable_Excuse41 t1_jdxbaqd wrote
That’s beside the the point, China knew very well the couldn’t pay back the loan. The loan about the 2 percent was made with contingent that the China merchant point would get 65 percent in 2012. In 2016 when they relinquish 80 percent ownership for 99 year contract. They couldn’t pay it off.
BrownMan65 t1_jdxctil wrote
>That’s beside the the point
No that's literally not besides the point. That is the point. Sri Lanka mismanaged the whole project and couldn't pay their debts because they didn't follow the plans that were established for them. It is not China's, or any country's, duty to baby a nation if they decide they want to go their own path. If Sri Lanka decides they want to move on with phase 2 immediately after phase 1, then that is solely on Sri Lanka and no one else.
Comfortable_Excuse41 t1_jdxg8qu wrote
That’s why the IMF had guideline. Sri Lanka couldn’t meet those guidelines so they went to china. It wasn’t the interest rate. China knew what was going on. They had the ability to make china merchant port 65 percent ownership. They could of forced them to wait. It’s a debt trap plain and simple. Plus your whole argument was that china was using debt trap diplomacy.
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