Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • January 2019 (Revised January 2022)
  • Case
  • HBS Case Collection

Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road?

By: Meg Rithmire and Yihao Li
  • Format:Print
  • | Language:English
  • | Pages:34
ShareBar

Abstract

In 2015, a surprise presidential election result seemed to imperil Chinese investments in Sri Lanka, which were associated with China’s Belt and Road Initiative to build global infrastructure. In the previous decade, China had undertaken two major projects in the country: the construction of a port in the poor district of Hambantota (also the previous president’s hometown), for which Sri Lanka borrowed 1.2 USD billion dollars from the China Ex-Im bank, and a major real estate project outside of Colombo. The new administration pursued renegotiation of both contracts. In 2016, a Chinese state-owned company purchased the asset of the Hambantota port, generating concerns about sovereignty in Sri Lanka and Chinese naval ambitions in Delhi and Washington, DC. This case explores the dynamics of China's ambitious Belt and Road Initiative, a large-scale infrastructure and connectivity project launched under its powerful leader, Xi Jinping, as well as the politics and economics of sovereign borrowing in the age of Chinese lending. Did Sri Lanka fall victim to a sort of “debt diplomacy,” or did the Chinese side fail to understand Sri Lanka’s domestic political landscape? Was the sale of the asset the right choice for Sri Lanka? The right investment for China Merchants Group, which bought the 99-year lease?

Keywords

Belt And Road Initiative; Investment; Infrastructure; China; Sri Lanka

Citation

Rithmire, Meg, and Yihao Li. "Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road?" Harvard Business School Case 719-046, January 2019. (Revised January 2022.)
  • Educators
  • Purchase

About The Author

Meg Rithmire

Business, Government and the International Economy
→More Publications

Related Work

    • January 2019 (Revised January 2022)
    • Faculty Research

    Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road?

    By: Meg Rithmire and Yihao Li
    • July 2022
    • Faculty Research

    Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road?

    By: Meg Rithmire
Related Work
  • Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road? By: Meg Rithmire and Yihao Li
  • Chinese Infrastructure Investments in Sri Lanka: A Pearl or a Teardrop on the Belt and Road? By: Meg Rithmire
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Accessibility
  • Digital Accessibility
Copyright © President & Fellows of Harvard College