China, in a strategic move, is actively pursuing the extension of the China-Myanmar Economic Corridor (CMEC) to Sri Lanka. This development signals China’s intent to enhance its Belt and Road Initiative (BRI) influence in South Asia.
Key Diplomatic Exchange: Chinese Special Envoy’s Visit to Sri Lanka
- High-Level Engagement: During a courtesy call on Monday, China’s Special Envoy and State Councillor, Shen Yiqin, informed Sri Lankan President Ranil Wickremesinghe about China’s prioritization of extending the CMEC to Sri Lanka.
- Trade Acceleration: Both parties expressed a mutual commitment to expedite the implementation of the China-Sri Lanka Free Trade Agreement, indicating an emphasis on enhancing economic ties.
- Strategic Importance: The China-Myanmar Economic Corridor (CMEC) has emerged as the newest of the six land corridors under the Belt and Road Initiative (BRI). Its prominence has grown, overshadowing the stalled Bangladesh China India Myanmar (BCIM) corridor.
- Global Participation: Sri Lanka, a participant in the BRI, views the extension of the CMEC as an opportunity to contribute significantly to the second phase of the initiative, enhancing economic cooperation.
Sri Lanka’s Diplomatic Stance: Active Participation in BRI
- Diplomatic Meetings: President Wickremesinghe’s meeting with Chinese President Xi Jinping in Beijing affirmed Sri Lanka’s active participation in the Belt and Road Initiative. A joint statement highlighted Sri Lanka’s commitment to the BRI proposed by China.
- Acknowledging Support: Expressing gratitude, President Wickremesinghe acknowledged China’s support in Sri Lanka’s debt restructuring program, emphasizing the importance of bilateral cooperation.
Economic Recovery and Debt Restructuring
- International Monetary Fund Support: Sri Lanka is in the process of finalizing a debt treatment plan with official creditors to receive the second tranche of the International Monetary Fund’s nearly $3 billion package for economic recovery.
- China’s Stance: While China remains an observer in deliberations with official creditors, it has opted to stay out of the official creditors’ platform, showcasing a nuanced approach in its economic interactions.
Future Prospects: Navigating Economic Challenges
- Debt Treatment Plan: Securing an agreement with official creditors is identified as a critical next step for Sri Lanka’s economic recovery, emphasizing the delicate balance Sri Lanka is navigating in its debt management.
- Strategic Alignment: China’s keen interest in extending the CMEC to Sri Lanka aligns with the island nation’s readiness to contribute substantially to the Belt and Road Initiative’s second phase.