China is the New Economic Dynamo of the World

Sri Lanka’s relationship with China was established even before diplomatic ties and pacts were inked. In fact, Sri Lanka-China relation dates back to the 4th Century AD, when the Chinese monk Faxian visited Sri Lanka. Since then the relationship has grown by leaps and bounds. Lanka Courier caught up by Sri Lankan Ambassador to China Dr. Palitha Kohona on the recent developments, the controversies and what lies ahead.

Getting rich is now acceptable in China but remaining poor is not. A sustained policy executed with purpose by the Communist Party of China has resulted in the elimination of absolute poverty, including among minorities, nine years ahead of the UN SDG goals. 800 million have been lifted up to the middle class creating the largest and most lucrative consumer market in the world. These are unparallelled achievements in human history. While still categorised as a developing country, China boasts of the second biggest economy in the world (after the US). It has, in a very short period, built the most comprehensive and stunning network of super highways and roads, the most extensive high speed railway network, the largest number of glittering high rise dotted large cities, the most impressive airports, etc. In the 70s, many Western economists wondered how the world would ever be able to feed China’s poor millions. Today China not only feeds itself lavishly, but is capable of exporting its surplus. China is leapfrogging the world when it comes to environment conservation and climate change action.

          Can you give us a brief history of the diplomatic relationship between China and Sri Lanka?

 Sri Lanka was one of the first countries to recognise the People’s Republic of China in 1950. Breaching a Western embargo, Sri Lanka concluded the Rubber-Rice pact with China in 1952. Bilateral diplomatic relations were established in 1957. Sri Lanka also consistently supported the “One China” policy. At the United Nations, we were always a vocal advocate of the readmission of the People’s Republic of China to its legitimate position in the Organisation. During the separatist conflict in Sri Lanka, China was one of those countries that supported Sri Lanka unconditionally, including with necessary arms. Later, after the conflict ended in May 2009, China stepped up with funding to facilitate rapid economic recovery.

          What are the potential areas that you have identified to strengthen the diplomatic relationship?

 I believe the diplomatic relationship is already on a very firm foundation. This Is a comment that you often hear around Beijing. But like with everything human, you need to continue working at it. We need more frequent bilateral visits at all levels. The President of Sri Lanka has been in Beijing for some time now. But due to the pandemic, this visit could not be undertaken. Our Diplomatic representation needs considerable beefing up so that our contacts in the various fields, political, trade, investment, tourism, cultural, security, education, etc and with the provinces, could be strengthened in depth. Today we barely scratch the surface with threadbare staff at the Mission in Beijing despite the increasing importance of China to us in many different fields. Increased manpower in the Mission should be considered a priority investment in the future. Our neighbours have recognised this necessity. Having increased their diplomatic staff in Beijing and the Consulates General in other cities, they are reaping the benefits, especially in trade.

          What are the challenges you foresee in achieving these goals particularly in the socio-political and economic spheres?

 China has assumed the position of key provider of political and economic support for Sri Lanka. It can also be a tremendous source of tourists and also a major market for our products. 169 million Chinese made outbound visits in 2019. In 2018, barely 265,000 of them visited Sri Lanka. Many of our neighbours gleefully attracted millions more. Most of their embassies have deployed dedicated units and financial resources to milk this Chinese tourism cash cow while we have not given sufficient attention to this aspect. As is obvious from the numbers of Chinese descending on the Galleries Lafayette in Paris, Chinese tourists are big spenders and they could very well be our economic salvation. They are also unlikely to disrupt our cultural values. The same could be said of our feeble efforts to woo investors and improve exports.  The Chinese market is a complex minefield which needs to be navigated with care and with much circumspection. Chinese consumer idiosyncrasies, including their obsession with live streaming and online purchasing, and customs requirements need to be understood and exports packaged and labelled in Chinese to meet their needs. Likewise, Sri Lanka could become part of the supply chain for products made in China, including for software. Similarly, Chinese companies seeking to manoeuvre themselves out of the trade quagmire being imposed by the West could be wooed to relocate in Sri Lanka, with our easy access to the vast sub continental market. But this is a task for staff dedicated to it. Sri Lanka needs to strengthen its representation in Beijing to be able to operate effectively in a very competitive and selective environment. However hard the Ambassador and the three or four senior officers try, with only a symbolic staff allocation at junior level, it is difficult to ensure follow up and produce effective results. The Embassy needs more staff who can follow up on the contacts that I make. Sri Lanka can benefit so much more from engaging with the provinces. Many of the cutting edge technology companies, and research institutions, both industrial and agricultural, are located in the provinces. The top universities and research establishments are located far from Beijing.

          What in your opinion is the potential of the BRI to this region and the benefit of Sri Lanka?

 The BRI is going to provide a major economic impetus to the countries of the wider region. Already its impact is being felt. China expects to expand between 4 – 8 trillion USD on the BRI. Sri Lanka could benefit immensely from this bonanza. We have the opportunity to wisely use the BRI funds for our benefit or we could let this opportunity also slip by as we have done so many times in our post colonial history and watch others in the region prosper. We have the expertise and the skills to use the BRI funds to our advantage but we need to martial them and use them in a well planned manner while building a national consensus.

          With regards to the Port City Economic Commission Bill there was much opposition to it locally, how do Chinese investors perceive it?

 In a democracy there is likely to be a range of views, informed and uninformed, on any issue. What is important is for our leaders to build a national consensus or at least a majority view, convince our people and articulate their policy convincingly. Our judiciary has expressed itself in clear terms and that is a good basis to market the Colombo Port City to potential investors. President Gotabhaya Rajapaksa made a convincing case in his introductory statement at the opening of the Colombo Chamber of Commerce Investment Forum. Government spokesmen should take their cue from his speech and go into overdrive now.  We have invited investors from all over the world to make use of the Colombo Port City to advance their own commercial interests, not only Chinese investors. Chinese investors are like any other investors. They look for secure and welcoming locations for their investments where they could make profits.

          A majority of Sri Lankans have opted to have the Sinopharm vaccine, while orders are being placed for me. In what ways is the embassy engaged in this?

 As a result of the overtures made by President Rajapaksa to President Xi Jinping and the constant engagement of the Embassy with Sinopharm and Sinovac at the highest levels and with the Chinese Foreign Ministry since January, China agreed to dispatched 3.1 million doses of the Sinopharm vaccine in June and is sending a further 10.9 doses in the coming months. Not a day passes without the Embassy making contact with these entities and our authorities have also been kept informed since we first started contacts in January.

(Special thanks to Foreign Ministry of Sri Lanka for facilitating this interview.)

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