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The Illusion of Prosperity: Investigating the Hambantota Port Project


“We are rich only through what we give, and poor only through what we refuse.”

– Anne Sophie Swetchine

 

The Hambantota Port, often touted as a cornerstone of Sri Lanka's economic development, has become a symbol of controversy and a cautionary tale of political ambition, financial mismanagement, and socio-environmental neglect. This article delves into the history, development, and current state of the Hambantota Port, exploring its implications for the country and its people.

 

The Strategic Promise: History and Importance of Hambantota Port

 

Hambantota, a coastal town in the southern part of Sri Lanka, has long been recognized for its strategic location. Situated near the world's busiest maritime route that connects Europe and Asia, it holds significant potential for facilitating international maritime trade. The natural deep-water harbor in Hambantota was identified as early as the 1970s as a potential site for a major port, given its proximity to key shipping lanes that account for a substantial portion of global maritime traffic.

 

The idea to build an international port in Hambantota gained momentum in the early 2000s, driven by the vision of transforming Sri Lanka into a strategic maritime hub. This vision was aligned with the global trend of expanding port infrastructure to handle increasing volumes of international trade. The government foresaw the port as a gateway for economic development, aiming to attract global shipping lines, create jobs, and stimulate regional growth.

 

Hambantota's strategic promise also extended beyond trade. The location was seen as pivotal for regional security and geopolitical influence. By establishing a major port in Hambantota, Sri Lanka aimed to enhance its naval capabilities and play a more significant role in the Indian Ocean's maritime security dynamics. The port was envisioned as a multifaceted project that would boost trade, tourism, and industrial development in the region, ultimately contributing to national economic growth.

 

However, the strategic allure of Hambantota also brought geopolitical complexities. The involvement of China in financing and constructing the port positioned Sri Lanka within the broader context of Sino-Indian rivalry in the Indian Ocean. While China viewed the port as a crucial node in its Belt and Road Initiative, India and other regional players expressed concerns about the implications of increased Chinese presence in the region.

 

Genesis of the Project: Vision and Initiation

 

The Hambantota Port project was initiated under the leadership of President Mahinda Rajapaksa, a native of Hambantota, who envisioned the port as a catalyst for regional development and national economic growth. The project was part of the larger "Mahinda Chinthana" vision, which aimed at rapid infrastructure development across the country.

 

Rajapaksa's administration saw the port as a critical element of its ambitious infrastructure agenda, which included highways, airports, and other ports. The project was fast-tracked, with the government securing substantial financial support from China. This support came in the form of loans from Chinese state-owned banks, with the China Harbor Engineering Company being awarded the construction contract.

 

Political Dynamics: Ambition and Execution

 

The political landscape played a crucial role in the project's trajectory. The Rajapaksa administration pushed the port's construction with considerable vigor, often sidelining critical feasibility assessments and stakeholder consultations. Despite the project's grand promises, questions about its viability surfaced early on.

 

The urgency to complete the project was driven by political motives. The Rajapaksa government, keen to demonstrate rapid progress and tangible achievements, overlooked several red flags. There was significant pressure to inaugurate the port before the 2010 presidential election, which resulted in hasty construction and inadequate planning.

 

Feasibility and Stakeholder Engagement: Overlooked Essentials

 

A comprehensive feasibility study was conspicuously absent, and there was minimal consultation with key stakeholders, including the local community, environmental experts, and economic analysts. This oversight led to significant issues during and after the port's construction.

 

The feasibility studies that were conducted largely ignored crucial factors such as the existing shipping patterns, potential competition from other regional ports, and the actual demand for port services in Hambantota. Experts who raised concerns about the port's economic viability and environmental impact were often sidelined or ignored.

 

Local communities were inadequately informed and consulted about the project's implications. Many residents were unaware of the full extent of land acquisition and displacement that would occur. The lack of transparency and proper engagement created a sense of mistrust and resentment among the affected populations.

 

Socio-Environmental Impact: Displacement and Degradation

 

The construction of the Hambantota Port resulted in the displacement of local communities and significant environmental damage. Families were forced to leave their homes without proper compensation or resettlement options, leading to ongoing struggles. The environmental consequences included the destruction of ecosystems and wildlife habitats, impacting local livelihoods such as fisheries. Despite promises of economic benefits, many affected residents did not see these materialize, exacerbating the challenges faced by the community.

 

Financial and Political Turmoil: Debt and Corruption

 

The construction and subsequent operation of the Hambantota Port not only led to the displacement of local communities and environmental degradation but also raised concerns about governance, transparency, and long-term sustainability. The project, often touted as a symbol of economic development and infrastructure advancement, faced criticism for its lack of transparency in decision-making processes and potential corruption in land acquisition and contract agreements.

 

Moreover, the promises of economic prosperity for the region failed to materialize for many residents, exacerbating existing socio-economic inequalities. The majority of employment opportunities generated by the port were temporary and low-paying, further deepening the economic hardships faced by the affected communities.

 

Furthermore, the environmental impact of the port extended beyond the initial construction phase. Ongoing port operations, including shipping activities and associated infrastructure development, continued to pose threats to local ecosystems and wildlife habitats. Issues such as pollution from shipping vessels, increased traffic congestion, and potential oil spills further compounded the environmental concerns surrounding the port.

 

Despite these challenges, local communities and environmental activists have been actively advocating for greater accountability, sustainable development practices, and community engagement in decision-making processes related to the port. Efforts to address the grievances of displaced families, mitigate environmental damage, and promote inclusive and equitable development strategies are ongoing but require continued collaboration and dialogue among stakeholders at the local, national, and international levels.

 

Controversies and Instability: Ownership and Control

 

In 2017, unable to repay the debt, Sri Lanka leased the port to China Merchants Port Holdings Company for 99 years. This move sparked national and international controversies, raising concerns about sovereignty and strategic autonomy. Critics argued that the port's lease was a manifestation of China's "debt-trap diplomacy," which undermined Sri Lanka's independence and economic security.

 

The decision to lease the port was met with widespread criticism and protest within Sri Lanka. Many viewed it as a surrender of national assets and a compromise of the country's sovereignty. The lease agreement included provisions for a significant Chinese presence in the region, further fueling fears of geopolitical consequences.

 

Internationally, the Hambantota Port became a focal point in discussions about China's Belt and Road Initiative and its implications for developing nations. The port's lease to a Chinese state-owned enterprise was seen as a strategic move by China to secure a foothold in the Indian Ocean, raising alarms in India and other regional powers about the potential for increased Chinese influence and military presence.

 

Current Scenario: Ownership and Operations

 

Today, the Hambantota Port is under Chinese control, with operations focusing on cargo handling and port services. However, the expected economic boom has not materialized, and the port remains underutilized. The local community continues to grapple with the adverse effects of displacement and environmental changes, and the broader economic benefits remain elusive.

 

The port's current operations are primarily geared towards handling bulk cargo, but the volume remains significantly lower than initially projected. The economic activities around the port have not picked up as expected, leading to a sense of disillusionment among the local population who had hoped for increased employment and business opportunities.

 

The lease agreement has also resulted in limited benefits for Sri Lanka in terms of revenue generation. The majority of the profits are repatriated to China, with the local economy seeing only marginal gains. This has further fueled criticism of the deal and its long-term implications for Sri Lanka's economic sovereignty.

 

Future Prospects: Challenges and Opportunities

 

Looking ahead, the Hambantota Port stands at a crossroads. For Sri Lanka, the challenge lies in leveraging the port's strategic location while addressing the socio-economic and environmental fallout. Future plans should emphasize sustainable development, stakeholder engagement, and transparent governance to ensure that the port contributes positively to the nation's growth.

 

To realize the port's potential, there needs to be a concerted effort to attract more shipping lines and related industries. This requires not only improving the port's infrastructure and operational efficiency but also creating a favorable business environment. Policy reforms, investment incentives, and better integration with regional and global trade networks are crucial.

 

Moreover, addressing the socio-economic impacts on displaced communities is imperative. This includes providing adequate compensation, resettlement options, and ensuring that the local population benefits from the port's operations. Environmental restoration and sustainable practices should also be prioritized to mitigate the damage caused by the initial construction.

 

Conclusion: Lessons Learned

 

The tale of the Hambantota Port project serves as a poignant reminder of the multifaceted challenges inherent in undertaking large-scale infrastructure endeavors. Beyond its initial allure of economic prosperity, the project's journey has been fraught with complexities and setbacks, illustrating the indispensable necessity for comprehensive feasibility studies, transparent stakeholder consultations, and meticulous sustainable planning.

 

As the project unfolded, the grand vision for growth and development became entangled in a web of financial strain, political discord, and social disarray. Mounting debts, shifting geopolitical dynamics, and local community grievances cast a shadow over the once-promising venture.

 

This narrative underscores the sobering reality that ambitious undertakings demand more than just bold vision; they require unwavering commitment to rigorous execution and genuine consideration for all those affected. As we reflect on the lessons learned from the Hambantota Port project, it becomes evident that success hinges not only on grand designs but also on the ability to navigate the intricate interplay of economic, political, and social factors with wisdom, foresight, and empathy.

 

As Sri Lanka navigates its future, the Hambantota Port remains a testament to the complexities and challenges of balancing development with sustainability and sovereignty.

 

Special Note: Efforts to get hold of the original planners of the Hambantota Port project proved to be exceedingly difficult. Repeated attempts to contact key figures involved in the project's inception, including former government officials and representatives from the construction companies, were met with silence or refusal. Many of these individuals have either distanced themselves from the project or are no longer in the public eye, making it nearly impossible to obtain firsthand accounts or clarifications. This lack of transparency and accountability only deepens the controversy surrounding the port, as the absence of these crucial voices leaves many questions unanswered about the decision-making processes, feasibility studies, and stakeholder engagements that shaped the project's trajectory.

 

Featured image: Hambantota Harbour Sri Lanka by Dinesh De Alwis/Wikimedia Commons


Written by Shanika Gamage


The views, thoughts, and opinions expressed in this article reflect the author’s views, and not the wider views of the Alliance for Sustainable Infrastructure.

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