Sri Lanka today gets most of its foreign financing as loans from China. This graph shows that China has given 38% of financing this year, overtaking Japan (2012 FMR). Compare that to 2004, when they gave only 0.5% (2006 Annual Report).
Or compare it to 2008, when multi-lateral donors still really mattered.
Is this a bad thing? Not necessarily. This isn’t a case of China taking over as much as other countries and organizations stepping back. The US, as you can see, well, the US as you can’t see doesn’t give much and never has. They are the white sliver in the pies above. UK is also non-existent. These are bid trade partners, but not aid or financing.
China is giving money for roads (ironically, a lot of tax revenue seems to be going to Ministerial vehicles) and power plants and infrastructure. You could say we’re growing more indebted to China, but so is everybody, and our debt to GDP ratio is pretty normal.
Some of these investments are not great (trying to force growth in Hambantota rather than supporting it where it is happening, ie, the North Central province) but that’s the Sri Lankan government’s fault.
This year, China has signed agreements to fix roads in the north and south and for lighting in Uva, worth almost $800 million USD.
India, by contrast has signed agreements worth only about $9 million dollars, BUT those agreements were grants. Which is nice.
Geopolitically, this shows you how much influence America (white), Europe (blue) and international bodies (grey) have on the government. Which is not much at all. The west and India are huge trade partners, but any punitive action they could take would hit Sri Lankan businesses first and the government later if at all. There’s simply no leverage for the punitive war crimes bullshit so they should just get on with geopolitics as usual.
India has a similar lack of leverage, but they at least don’t speak loudly and carry a toothpick.
For reference: from Jan to September 2011, donors committed to USD 1.8 billion in financing. The governments 2001 revenue is projected at about $6 billion USD total (at the new exchange rate). Please see the full 2012 report.