Is Pakistan going to be the next Sri Lanka? Future perspective of CPEC
Ever since the launch of CPEC people of Pakistan have been in constant chaos about how CPEC will create a future picture of the country. There are multiple negative connotations attached to the flagship project of BRI, but the question is what actual impact would CPEC have on the economy of the country? Is it going to bring the country into a row of developed and stable economies, or is it going to give Pakistan the fate of Sri Lanka?
Digging deep into detail, we would be able to find the facts;
How was Hambantota port built, and how did the Sri Lankan government decide to put it on a 99-year lease to china?
The construction of the Hambantota Port began on January 15, 2008. Chinese companies Sinohydro Corporation and China Harbour Engineering Company were construction partners in the 1st phase of the construction, which was estimated at $360 million cost, excluding $76.5 million cost of the bunker terminal. The Chinese government provided 85% of the funding, whereas the Sri Lankan Ports Authority provided the remaining 15%. The funding provided by china was made on loan terms, in which the homeland country was made obligated to return to china during a certain period. Still, due to the shattering economy of Sri Lanka, the Sri Lankan government found itself in trouble in making debt repayments. So, In 2017, when Sri Lanka struggled to make debt repayments on time, it sold a 99-year lease of the port to the Chinese company that constructed it for some fast cash. Many writers and analysts penned multiple articles pointing to Hambantota as Exhibit A in theory, mentioning that China deliberately puts developing countries into a “dept trap” by offering loans to build extravagant infrastructure projects with the delusion of getting them into the list of developed nations.
Similarly, many analysts warned the same fate might befall Pakistan, where China have been majorly involved in development projects, specifically under the flag of China-Pakistan Economic Corridor (CPEC) since 2015. Like Sri Lanka’s Hambantota, the Chinese authorities have been massively investing in Gwadar, the deep-sea port in Pakistan’s southwestern Balochistan province that also serves as the epicenter of CPEC in Pakistan. Hence, the current news of Hambantota port rang bells about the future of CPEC in the corridors of power in Pakistan also. Some feared that if Chinese influence increased further in Gwadar, it might follow the example of the Sri Lankan port, for all the wrong reasons.
Today, the current economic and political situation has worsened tremendously in Sri Lanka, culminating in the country defaulting on its debt payments. Amid shortages of basic necessities, Sri Lankans have erupted in mass protests. And the crisis is unlikely to be resolved soon, even though the protesters have forced Rajapaksa the PM to quit, replaced by Prime Minister Ranil Wickremesinghe, who is also unpopular with the masses and seen as a symbol of the political status quo.
Once again, Pakistan (along with other developing countries) has come under discussion in light of the worsening situation in Sri Lanka, with questions as to whether the country may fall down the same dark path.
Future perspective of CPEC:
Ever since the development started on CPEC infrastructure projects, the surrounding vicinities of the route started to spike in demand and development of different economic as well as residential projects are in fast forward. But despite of all these developments and rising graph of prices in these many people are still hesitant to make an investment and have doubt on the future of CPEC.
As a Real Estate consultant Emirates Marketing acknowledges the duty to address all your queries with facts and figure and give you the best possible insight of your desired investment opportunity.
- How CPEC is different from Hambantota
The major difference between the two is as discussed above that, Hambantota port was build by the 85% loan funding of chinesse companies which Sri Lankan government was obligatory to return in given period of time which unfortunately due the economic restrains of Sri Lanka, Sri Lankan government found it hard to pay further elaborating the case the Sri Lankan decide to handover Hambantota to chinesse company who built it on 99 years lease in 2017 for some quick cash.
But the development of CPEC is way different than Hambantota Port as most of the projects in CPEC are on Built Operate & Transfer (BOT) model in which even though Chinese authorities are investing massively, but still after certain period of building and operating China is bound to transfer their ownership to Pakistan despite of all the current economic and political chaos of the country CPEC have the potential to change the fate of Pakistan all the way around as predicted.
- CPEC last nail in Coffin or Gateway to stable economy:
As mentioned above CPEC has a potential to change the fate of country positively and would make a quick access for Pakistan in the row of developed nation. When CPEC has such a bright future you can imagine your future in the closure vicinity of the CPEC route.
What would be future of investment in the surrounding of CPEC?
You would all agree with me you all want to have hands on some property in the fast growing residential and commercial projects along CPEC route the only thing you are looking for is some quality verification of yearly turn over. This is what we Emirates Marketing are known for so pick up your phone and contact us on given numbers and talk to one of our expert or visit Emirates Marketing on given address (address) and get all your queries addressed by us.
We at Emirates Marketing gives you an exclusive investment opportunity along CPEC that fits your budget without giving you any stress before its too late because;
CPEC is where future belongs