Port City Project before Parliament in February

By Ravi Ladduwahetty

Ceylon Finance Today: Thefuture of the Chinese financed US$ 1.4 billion Colombo Port city project will be submitted to Parliament in February, subject to the feasibility, cost appraisals and other environmental considerations.

We are for investments; but we have to see how feasible they are and also the cost and the benefits and the social impact as well, Deputy Minister of Highways and Investment Promotion Eran Wickremaratne told Ceylon FT.

The project is still at the review stage and the implementation and the going ahead will depend on these criteria, he said.

Other official sources confirmed that despite the project going through the Board of Investment only, the present government would make the entire project go through with the technical advice of not only the Board of Investment, but also the Sri Lanka Ports Authority and the Coast Conservation Department.

However, the project, if it has to proceed, would have to be approved in Parliament on or before 17 February, which is exactly three months after the project was gazetted on 17 November, 2014, which was two months after the first phase of the project was jointly commissioned by former President Mahinda Rajapaksa and Chinese President Xi Jinping on 17 September, 2014

The Chinese-financed US$1.4 billion.... 'Colombo Port City' project is its largest foreign-funded investment in Sri Lanka.

The Port City will be built by a unit of State-controlled China Communications Construction Co. Ltd on 233 hectares (576 acres) of reclaimed land. The offices, hotels, apartments and shopping centres will draw as much as US$20 billion in investment over about 15 years, which was meant to provide competition to Singapore and Dubai which were perceived to be running out of capacity."

Sri Lanka will own rights to 125 hectares of the reclaimed land and 20 hectares will be held by China Communications, with the remaining 88 hectares leased to the company for 99 years.

Colombo's Port is the only one in South Asia that can accommodate 18-metre deep draft vessels, putting it in position to serve the Indian subcontinent, the Middle East and some African States.

Chinese Government lending to Sri Lanka has increased 50-fold over the past decade to US$490 million in 2012, compared with US$211 million combined from Western countries and lending agencies.

Unlike previous infrastructure projects undertaken by Chinese companies in Sri Lanka, the port city is financed by equity from China Communications or funds raised through it, with no commitment or guarantee from the Sri Lankan Government.
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