Billions as interest
The Sri Lankan government has to pay US$111.21 million or some Rs.11.1 billion as interest for the US$ 307 million loan obtained from China for the Habantota Ports Development Project, it was revealed in parliament yesterday.
The total cost of the project is US$360 million, and of it only US$54 million was financed by the Sri Lanka Ports Authority while the balance funding was obtained from EXIM Bank of China.
Together with the accrued interest, the government will have to pay US$418.21 million to the Chinese Bank in 11 installments till December 31, 2022. The repayment will start next year, with the first installment of US$46.81 million. It will be followed by the second installment of US$45.05 million, the third installment of US$43.29 million, the fourth installment of US$41 million, the fifth installment of US$39.78 million, the sixth installment of US$38.02 million, the seventh installment of US$36.26 million, the eight installment of US$34.50 million, the ninth installment of US$32.74 million and the tenth installment of US$29.23 million.
This information was placed before the House in response to a question by United National Party (UNP) front-liner Ravi Karunanayake.
He charged that the Colombo Port was facing a severe financial crisis with an accumulated loss of Rs.8,900 million and amid such a heavy financial burden, he asked whether it was possible for the government to repay the loan taken for the development of the Hambantota Port.
Responding to Mr. Karunayake, Deputy Minister Rohitha Abeygunawardane said the government had a plan to settle this loan without having to face major problems and added that there was no financial crisis as such at the Colombo Port.
However, Mr. Karunanayake took up the Deputy Minister on this matter.
Munna hena gahanna ohne, Waraya dan pool ekakata thamai ganne wenne
what a wate of money.
AMDA AND NICLOAS DIAS PLEASE COMMENT
Most of us cannot afford to buy a house with ready cash. So we take out a bank loan, which is called a mortgage. This is repaid monthly, capital + interest, over a fixed period of time i.e the term of the mortgage loan, eg 25 years.
A small developing country like SL, does not have ready cash to build its infra-structure, industry, agriculture etc and meet the economic needs of the nation, especially when it is recovering from the trauma of 30 years of LTTE terrorism. We are assisted by bank loans from IMF, World Bank, and loans from India, China, Russia, Iran, Saudi Arabia etc. We also get aid in various forms from around the globe.
Just as we have to repay our mortgage monthly from our income, SL has to repay its loans annually from the income generated from its exports. From infra-structure development, agriculture and industrial development our export potential is increased greatly. One day we hope to be prosperous with no deficits and a healthy balance of trade payments, with all our loans paid up.
Several countries in Europe are today in deep economic crisis. Their budget deficits are huge. Greece, Italy, Spain, Portugal and Ireland are a few such countries who are well nigh bankrupt. Even Britain is struggling. All these countries have approached IMF, World Bank etc for assistance. The requirements for such loans are harsh, drastic measures of higher taxes, lower wages and reduced welfare payments. Unemployment has risen and cost of living is unbearable in these countries. There is growing civil unrest. More misery is on its way to EU countries with predicted food shortages through natural disasters and rise in fuel costs.
Hence, let us in SL count our blessings. We need to be truly grateful and bless our dear Hon President for the excellent planning and measures his government has taken to protect our nation from food shortages and economic disasters faced by the West.
Hambantota port and the second international airport in the south are investments for the nation to make us economically viable and prosperous. It is easy for traitors like RK to criticise. Any idiot can criticise. They have bird brains. Only wise men criticise constructively and co-operate to help build the nation. Just as we cannot expect a new business to generate huge profit overnight we have to give time to our infrastructure building to bear fruit in time in the future.