How China-backed projects made Sri Lanka’s economic meltdown worse

Name: Sri Lankan PM resigns as economic crisis worsens
Uploaded: 2022-05-11T03:07:36.000Z
Duration: 3 min 12 s
Description: Sri Lankan PM resigns as economic crisis worsens

Sri Lanka borrowed heavily to plug budget shortfalls and trade deficits, but also squandered huge sums on ill-considered infrastructure projects

Many of these projects now gather dust in the home of the powerful Rajapaksa clan, which used billions in Chinese loans in a failed effort to transform the area

Reading Time:3 minutes

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China’s President Xi Jinping pictured with Mahinda Rajapaksa, Sri Lanka’s then-president, during a state visit to Colombo in 2014. Rajapaksa resigned as the island nation’s prime minister this week following months of protests. Photo: AP

Agence France-Pressein Hambantota

Published: 11:07am, 11 May 2022

An airport without planes, a revolving restaurant with no diners, a debt-laden seaport – Sri Lanka’s economic crisis has been exacerbated by Chinese-funded projects that stand as neglected monuments to government extravagance.

The South Asian island nation borrowed heavily to plug years of budget shortfalls and trade deficits, but squandered huge sums on ill-considered infrastructure projects that have further drained public finances.

It is now in the grip of its worst financial crisis since independence from Britain in 1948, with months of blackouts and acute shortages of food and fuel plaguing its 22 million people.

03:12

Sri Lankan PM resigns as economic crisis worsens

After weeks of largely peaceful protests demanding the government resign over its economic mismanagement, things turned violent on Monday after pro-government supporters clashed with demonstrators, leaving at least eight people dead and more than 225 wounded.

Many of the white-elephant projects that helped fuel the crisis now gather dust in Hambantota district, home of the powerful Rajapaksa clan, which used its political clout and billions in Chinese loans in a failed effort to turn the rural outpost into a major economic hub.

Prime Minister Mahinda Rajapaksa – who commissioned many of the projects – announced his resignation on Monday, the same day the anti-government protests turned violent.

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