Port City investor company CHEC Port City Colombo Ltd., yesterday welcomed this week’s Cabinet decision to establish the Colombo Port City Special Economic Zone, which will be an international business and services hub with specialised infrastructure facilities.
It also said that this initiative will bring more foreign direct investment (FDI) into Sri Lanka.
‘The Colombo Port City Economic Commission Bill’ will form the framework for the law that would be applicable within the Port City. The Cabinet of Ministers approved the proposal made by President Gotabaya Rajapaksa, and will now take the necessary steps to publish the relevant bill on the government gazette and submit it to Parliament shortly.
The Colombo Port City Special Economic Zone is expected to create a conducive and competitive environment in attracting FDI.
Urban development via SEZs is not unique to Sri Lanka; there are many successful SEZs all over the world. An SEZ offers relief from various forms of taxation for businesses and individuals that qualify. They also offer superior infrastructure, with streamlined administrative processes in place that results in ease of doing business. SEZ’s have been a useful tool for developing nations to upgrade infrastructure, human capital and institutional frameworks, and test out policies and their impact before they are selectively implemented in the rest of the country.
The establishment of a well-positioned SEZ will benefit the nation by virtue of upgrading resources and capabilities where policy makers can overcome bottlenecks in resource mobility and reduce the costs of larger scale implementation or upgrading across the entire country. A successful SEZ sends an important signal that the country is open for business.
The facilitative environment expected to be created through the ‘Colombo Port City Economic Commission Bill’ is supported by the first-world infrastructure made available in the 269 hectares of reclaimed land at the Port City, and is expected to result in the inflow of both financial and human capital, promote local and foreign entrepreneurs, create employment opportunities, and enable talent retention. It is expected that the SEZ will attract multinational enterprises to set up headquarters or regional offices in the Port City and, in turn, bring in financial recourses, technology, and technical and managerial know-how.
“We hope the establishment of a SEZ will accelerate Sri Lanka’s economic growth. A realised master plan for the Port City provides 5.7 million square metres of built up area valued at $ 15 billion that will be home to multinational enterprises, corporate headquarters, transient workers, and residents. It will be the catalyst for a modern services hub that will help Sri Lanka’s transformation into a services-led growth model and elevate the economy to high-income status,” CHEC Port City Colombo said.