Sri Lanka, struggling with debt, hands a major port to China

[sandensea]

Struggling to pay its debt to Chinese firms, the nation of Sri Lanka formally handed over the strategic port of Hambantota to China on a 99-year lease last week, in a deal that government critics have said threatens the country’s sovereignty.

In recent years, China has shored up its presence in the Indian Ocean, investing billions of dollars to build port facilities and plan maritime trade routes as part of its “One Belt, One Road” initiative to help increase its market reach.

Along the way, smaller countries like Sri Lanka have found themselves owing debts they cannot pay. Sri Lanka owes more than $8 billion to state-controlled Chinese firms, officials say.

Sri Lankan politicians said the Hambantota deal, valued at $1.1 billion, was necessary to chip away at the debt, but analysts warned of the consequences of signing away too much control to China.

“The price being paid for reducing the China debt could prove more costly than the debt burden Sri Lanka seeks to reduce,” said N. Sathiya Moorthy, a senior fellow specializing in Sri Lanka at the New Delhi-based Observer Research Foundation.

At: https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-china-port.html

[democratisphere]

1. America will be doing the same after the redumbliCON tax shill passes.

[sandensea]

2. I suspect that's indeed the idea

Keep your eye on Paul "the vulture" Singer. That old buzzard is waiting for GOP congresscritters to hand him a bond default (he was said to be in talks with Eric Cantor when Cantor nearly caused a default in 2011, you'll recall).

Now that he has the legal precedent (the Argentina case in 2014), he can show up the next day and claim some astronomical payout of his own choosing (the judge awarded him 1600%; he settled on 1180%) on account of his "expecting" it when he bought the bonds in bad faith.