Sri Lanka -Under debt duress, Uganda could lose international airport

178

Location: Colombo – Sri Lanka

Language: English & Sinhala

Duration: 00:05:49

Source: A24

Restrictions: A24 Subscribers

Dateline: 31-03-2022

Storyline:

Experts have now started raising the possibility that Uganda might lose the Entebbe International Airport over foreign debts, as the media was suggesting the events, reminiscent of when the Port of Hambantota in Sri Lanka was lost due to debts, will lead to losing the airport to the debtors. The Education Secretary of the Frontline Socialist Party (FSP), Pubudu Jayagoda, said the Entebbe International Airport said that Uganda might not be able to repay a $207 million loan it had borrowed from China on time, spreading rumors amongst media that the airport might be lost at any given time. Beijing, however, categorically denied the accusations. He explained that in case the repayment of loan obligations is not met, various things have to be paid as ransom, adding that there would be a property grab in case a failure of paying was to take place. Jayagoda said China tends to ask for taking possession of highly strategic and important facilities as a precondition for approving a loan to a country. He added that there must be a stop to borrowing and there should be an investment in infrastructure to avoid falling under the debt trap.

Shot list:

 (Soundbite) Yasiru Ranaraja, a co-founder of the Belt and Road Initiative Sri Lanka (BRISL):

“During the grace period, the Ugandan government only had to pay the interests, not the loan itself. So, once the loan is finished, the grace period would have also finished. They started paying instalments for the $200 million loans. This was highly controversial since the grace period is finishing. The Ugandan government and the Central Bank of Uganda and the finance Minister of Uganda wanted to re-engage or restructure its debt as the Airport was not profiting as it was. So the government of Uganda gave a proposal or requested China to re-arrange the debt, and some arrangements were rejected by China. So, this due to this, the media was suggesting that China is going to take over the Ugandan Airport.”          

 (Soundbite) the Education Secretary of the Frontline Socialist Party (FSP), Pubudu Jayagoda: 

“The Entebbe International Airport in Uganda is reported to be taken over by China due to non-payment of a loan owed to China. Uganda had borrowed $ 207 million at a 2% interest rate from China and could not repay it on time. Recently, the media had reported that the Entebbe International Airport was to be taken over by the Chinese due to the inability to re-pay. It was later reported that China had denied any such accusations and that the news was false. However, there are currently international immunization rules for these types of loans. African countries like Uganda are borrowing in defiance of those laws. However, there are currently international immunization rules for these types of loans. When those loans are not repaid, various things have to be paid as ransom. For example, in the recent past, a large number of loans was taken from China, in return, the Port of Hambantota had to be handed over to China, the control of the Colombo Port City is with China, the South Terminal of the Port of Colombo had to be handed over to China and now some valuable lands in Colombo city have been transferred to a company called Selandiva. It is reported that a significant portion of it will be taken by China, along with seven acres of valuable land near the port.”

 (Soundbite) the Education Secretary of the Frontline Socialist Party (FSP), Pubudu Jayagoda):  

“An agreement has been signed to hand over the oil store complex near the Trincomalee port to India as a precondition for obtaining a loan from China and India. An agreement has been signed to hand over the western jetty of the Colombo Port to an Indian company. They demand from the Indian Oil Corporation (IOC) to extend the term of its existing oil stations if Sri Lanka wants to obtain further loans in addition to the $ 500 million and $ 400 million swap loan facility. It is reported that discussions are being held regarding the Kankasanthurai Port and the Palaly Airport. This is a very dangerous situation. There is no proper plan to repay these loans. When those debts are not repaid, there is a risk of massive destruction and alienation of the country’s national resources, public resources and public property. Serious attention needs to be paid in this regard. The only way to do this is to put an end to borrowing and building infrastructure systems. Or what happens to Uganda today could happen to Sri Lanka tomorrow.”

To download material

You might also like

Comments are closed, but trackbacks and pingbacks are open.