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China's ties with Sri Lanka raise concerns about control of global trade

LEILA FADEL, HOST:

China has built ports, highways and bridges around the world, and that makes some Western governments suspicious. They worry China could use infrastructure to control global trade or even to advance its military. One example is Sri Lanka, where Beijing has invested billions. NPR's Lauren Frayer reports from the Sri Lankan capital of Colombo about worries that China could now take advantage of the Indian Ocean nation as its economy collapses.

(SOUNDBITE OF FOOTSTEPS)

LAUREN FRAYER, BYLINE: Wow. The road just ends at the sea here. This is spectacular.

JUDE NAMAL: My house.

FRAYER: This is your house?

NAMAL: Yeah.

FRAYER: Srimali Fernando comes from a long line of fishing families north of Colombo. Her favorite photo is of her children playing on this bluff overlooking the sea right in front of their house.

SRIMALI FERNANDO: (Speaking Sinhala).

FRAYER: But that house is no longer safe to live in. Three years ago, most of the Fernandos' property crumbled into the sea.

FERNANDO: (Speaking Sinhala).

FRAYER: "It was terrifying," Srimali says. "Thank God no one was hurt."

Coastal erosion is often due to climate change. But here, scientists say it's at least partly due to China. A Chinese construction company has been dredging sand nearby to build a giant port city.

Can we see the port city from here?

NAMAL: Oh.

FRAYER: It's there?

NAMAL: Twenty miles, 25 miles. (Speaking Sinhala).

FRAYER: "This is economic colonialism," says activist Jude Namal, who helped get compensation for the Fernando family. "China exploits our country, but it's our leaders who let them do it," he says.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED PERSON: (Non-English language spoken).

FRAYER: You hear the word China a lot at protests that have swept this country. People are angry about inflation and fuel shortages. They accuse two past presidents - Gotabaya and Mahinda Rajapaksa, who are brothers - of running the economy into the ground. Protesters are calling for scrutiny of everything they did while in power. And one of the biggest things was to sign opaque investment deals with China.

SHREEN SAROOR: I think people are getting educated. Previously, they didn't have much of information.

FRAYER: Human rights activist Shreen Saroor says at first, these Chinese projects - ports, power stations and airport, a giant lotus-shaped tourist tower - at first they looked swanky, like symbols of Sri Lanka's development. But some of them now look like white elephants - useless for now-bankrupt Sri Lanka but possibly useful for China.

This week, a Chinese survey ship docked at one of the ports China has built here. It's a ship foreign security experts say has been used for military surveillance in the past. And its arrival set off alarm bells in neighboring India, which has tense relations with Beijing. Sri Lanka feels stuck in the middle, Saroor says.

SAROOR: People are very worried whether we will be the battlefield between China's and India's tension, whether Sri Lanka will be the point where the war will start.

FRAYER: If not a war with weapons, she says, then a war for economic influence. India is also a big lender to Sri Lanka, but it can't afford to do more. It's dealing with its own inflation crisis. Sri Lanka is now waiting for a bailout from the International Monetary Fund. And in the meantime, W.A. Wijewardena, a former Sri Lankan central banker, told me...

W A WIJEWARDENA: We need money to survive. We need about 800 million U.S. dollars per month. Somebody will have to finance it. Earlier, that somebody was the European Union, USA, Japan or India, which has its own problems. Now that somebody - China.

FRAYER: China, he says. It has deep pockets, and it's willing to lend faster than the IMF with fewer questions asked. So Wijewardena says Sri Lanka will probably take on more Chinese loans, go further into debt to Beijing, in order to survive until January, when an IMF bailout is likely. Not everyone sees that as a bad thing.

CHAMATH GEETHAN: They have the five tones - ma, ma, ma, and the fourth one is ma.

FRAYER: Chamath Geethan is a Sri Lankan businessman who's accepted China's presence here and is learning Mandarin. He got a scholarship to study in China and a job at the port city in Colombo when he got back.

GEETHAN: The Chinese market expanding in Sri Lanka - expanding. It's, like, huge expanding.

FRAYER: For Geethan, learning Chinese has been a good career move. He also thinks it's good for his country to learn to communicate with one of its biggest lenders on Sri Lankan terms.

GEETHAN: If they need to develop our country with a port city or something, we need to have a clear mind what they are going to do in future and how we can deal with them. So we don't need to blame to anyone.

FRAYER: He says it's easy to blame China or the ousted ex-president for all of Sri Lanka's problems. It could be harder, though, for the country's new leaders to avoid the same mistakes.

Lauren Frayer, NPR News, in Colombo, Sri Lanka. Transcript provided by NPR, Copyright NPR.

Lauren Frayer covers India for NPR News. In June 2018, she opened a new NPR bureau in India's biggest city, its financial center, and the heart of Bollywood—Mumbai.
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