So why is Sri Lanka handing over the management of Hambantota Port to China? Well, it was built in 2010 with a massive loan from Beijing. After incurring heavy losses, the Sri Lankan government stepped in last year and suggested China buy a sizeable stake to offset the debt. The two sides signed an agreement in July this year, whereby China Merchants Port Holdings would have a 70-percent stake and manage its operations. While Sri Lanka would be responsible for security, navigation and approvals.