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China is not the only girl on the beach: Sri Lanka finance minister

COLOMBO (EconomyNext) – Sri Lanka is not solely dependent on projects funded by China for growth and economic links with other regions can take up the slack, Finance Minister Ravi Karunanayake said.

"China is not the only girl on the beach," he said. "We have very good relations with India.

"We want to explore the EU area which has been blocked for the last 10 years and open up the US."

Karunanayake said the new administration will also look at stronger economic link with the South Asian region.

Powerful businesses linked to the Rajapaksa regime scuttled a comprehensive economic partnership agreement with India that would have given greater trade and service freedoms to Sri Lankan citizens, while getting closer to China.

Sri Lanka’s new Maithripala administration has promised to end human rights abuses of Sri Lanka citizens and get GSP+ trade concessions from Europe which will give a price advantage for the country’s exports to the region.

Sri Lanka lost the benefits during the Rajapaksa regime which was not willing to fully comply with the International Covenant of Civil and Political Rights, the country has already signed.

This week a fish export ban to the EU also takes effect over unregulated fishing and foreign minister Mangala Samaraweera has rushed to Europe to try and get a six month delay in the ban.

Sri Lanka’s post war construction was heavily financed by Chinese loans which helped boost the construction sector, helping boost gross domestic product numbers.

The new administration has already suspended an expressway to the island’s north to have been financed with borrowed Chinese funds.

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A self-financed sea reclamation project in Colombo by a Chinese state firm is under review over national security concerns and fears that China will claim the sea around it with the country having similar disputes with Vietnam, Philippines and Japan.

Karunanayake however said Sri Lanka had good relations with China.

"We are telling the Chinese is nobody is prevented from doing projects here," he said.
"But basically we cannot be told to endorse projects where costs are inflated."

He said suspended projects such as the northern expressway could go ahead at a revised cost.

Chinese road projects made headlines for their high costs, after being awarded without open tender.

Karunanayake said unsolicited projects would not be encouraged by the new administration and a ‘very rigid’ process will be followed.