Govt. says Volkswagen plant must open LoCs or face cancellation

Friday, 21 June 2019 00:00 - - {{hitsCtrl.values.hits}}

Malik tells Parliament long-overdue project must start within two months
Says Volkswagen not involved, but investor has proposed new brand
Agreement of technical collaboration yet to be submitted by local investor

The Government will be compelled to revoke the agreement with Western Automobiles – the investor who was to assemble motorcars under the Volkswagen brand in Kuliyapitiya – unless Letters of Credit are opened within the next two months to import prefabricated buildings and other essentials for the project.

Minister of Strategic Development and International Trade Malik Samarawickrama, responding to a question for oral answer yesterday in Parliament, held the project was delayed considerably and the Government is not willing to extend it further. The total investment for the project was estimated at $ 26.5 million, out of which $ 5.7 million has already been invested.

“On 3 January 2017 at the Mahanugalanda Estate in Labuyaya, Kuliyapitiya, the foundation stone was laid. It is no longer Volkswagen, but the investor has proposed to assemble another renowned brand. The agreement for the technical collaboration is yet to be submitted,” held Minster Samarawickrama, who confirmed to the Parliament that 29.5 acres of land was allocated for the project along with another 5 acres for flood prevention.

According to Minister Samarawickrama, the investor had already started putting up a training centre, and 90% of the construction work had been completed where the importation and the installation of equipment for workers training was progressing.

“We expect the training of students for the assembly plant to commence in October this year,” he confirmed. (AH)