Thursday, 18 September 2014 00:16
President Xi and President Rajapaksa flag off construction work of city that will change Colombo skyline
The Colombo Port City project, the largest foreign-funded investment on record in Sri Lanka, commenced yesterday with the commissioning of construction of Phase 1 by Chinese President Xi Jinping and President Mahinda Rajapaksa.
The Chinese-financed $ 1.4 billion Colombo Port City project is its largest foreign-funded investment on record.
The Port City will be built by a unit of state-controlled China Communications Construction Co. on 233 hectares of reclaimed land, an area slightly larger than Monaco. The offices, hotels, apartments and shopping centres will draw as much as $ 20 billion in investment over about 15 years, according to Ports Authority Chairman Priyath Wickrama. “The Government wants to convert Sri Lanka into a maritime centre,” Wickrama said in an interview. “We can give some competition to Singapore and Dubai, which are 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, said Parakrama Dissanayake, former Chairman of the Chartered Institute of Logistics and Transport in Sri Lanka.
Chinese Government lending to the island nation has increased 50-fold over the past decade to $ 490 million in 2012, compared with $ 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.
Besides Sri Lanka, President Xi also visited the Maldives on this trip, which he called “an important stop of the ancient maritime silk road” in an article published in local media, and is visiting India.
The Chinese President last year unveiled plans to build a maritime Silk Road, referring to an ancient series of land routes that connected China to the Mediterranean Sea, linking traders, priests, artists and explorers. Details on the project are short and may be fleshed out at the Asia-Pacific Economic Cooperation meeting in Beijing in November.