Late last month, sri Lanka`s Cabinet of Ministers authorized a major breakthrough in the implementation of the Millennium Challenge Corporation`s (MCC) $480 million grant and released the final draft grant agreement for public review. The agreement has indeed been at the center of heated debates and political clashes in recent months, with the president refusing to approve the agreement before the end of his term, a petition for fundamental rights (FR) against the signing of the agreement before the Supreme Court and even orchestrated a protest almost earlier this week. But with the public agreement with the continuation of negotiations, the evaluation of the cabinet and the stamp of the agreement of the Attorney General (AG), what still needs to worry Sri Lanka? Who is the MCC and what do they do? Some politicians and civil society groups have linked the draft MCC pact to other more open security agreements, such as the United States. Status of Forces Agreement, which creates the framework for the entry of US military personnel into Sri Lanka and which some critics have seen as an attempt to create a US military base, or even a possible base in the country. U.S. officials called the latest claim „blatant disinformation.“ In recent months, China has made significant and visible efforts to help Sri Lanka – and many other countries – respond to the COVID-19 pandemic, including a $500 million loan agreement signed in March. Two main arguments have been put forward against this agreement. The first is that the land project will mean that the country belonging to the Sri Lankan government will be available to the US government for purchase. The second argument is that the MCC agreement is an attempt to undermine Sri Lanka`s national security. While the two claims of MCC Resident Country Director Jenner Edelman (12) have been disputed, one suspicion remains. Indeed, Sri Lanka is often cited as a case study for debt trap diplomacy in the region and the argument that the government should be vigilant in revising the terms of future development agreements is justified. However, after verification of publicly available information resources, the MCC grant does not involve the lease or transfer of ownership of Sri Lankans and does not require Sri Lanka to repay any of the grants until the agreement is expressly violated. This is a standard guarantee that characterises international aid agreements and aims to ensure that subsidies are used exclusively to achieve the objectives of the Pact and do not fall into the wrong hands.
Other concerns regarding the construction of a physical economic corridor, links to the SOFA and ACSA agreements, the acquisition of Sri Lankan land by the US government, undervalued land transactions, the construction of US settlements and/or military bases, the construction of electric fences and the destruction of the local environment were also confirmed as unfounded during the revision of the agreement. The document makes it clear that the Sri Lankan government is `primarily responsible for monitoring and managing the implementation` of the projects and that a signed legal opinion from the Sri Lankan GA must be sought before the agreement enters into force (13). Even after the signing of the agreement, Sri Lanka still has the possibility to amend the agreement, provided that such amendments do not exceed the aid allowance awarded or extend the duration of the aid by five years. . . .