BrownMan65 t1_jdwtdef wrote on March 27, 2023 at 7:41 PM

Reply to comment by Comfortable_Excuse41 in China Energy proposes $1bn floating solar farm In Zimbabwe by Wagamaga

> 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 on March 27, 2023 at 7:46 PM

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 on March 27, 2023 at 7:53 PM

>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 on March 27, 2023 at 8:01 PM

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 on March 27, 2023 at 8:34 PM

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 on March 27, 2023 at 9:37 PM

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 on March 27, 2023 at 9:47 PM

>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 on March 27, 2023 at 10:11 PM

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.