Port city project:

Chinese contractor to invest US $ 1.34b

The new port city would be built, without the government spending a rupee, while the Chinese firm, which got the contract will pump in US$ 1.34 billion to complete the first phase of the project, Sri Lanka Ports Authority Chairman Dr. Priyath Bandu Wickrama told members of the Sri Lanka-Germany Business Council of the Ceylon Chamber of Commerce, at a breakfast meeting on the proposed Port City and the country's journey towards becoming South Asia's maritime hub and a logistics centre, recently.

The German Ambassador Juergen Morhard was also present.

The first phase will include reclaiming the land, building the breakwater and developing the infrastructure.

According to the Port Chairman, the Chinese firm will be given 108 hectares, out of 234 hectares that will be reclaimed in return for their investment. The firm will bring in a further US$ 2.5 billion, to develop the land allocated to the company. The land will be given on a 99-year lease.

Wickrama said the Government will have 125 hectares and that land would be given on lease to potential investors. He said some local investors have shown interest in investing in the new city.

The city will include modern office complexes, five star hotels, a yacht marina, residential apartments, recreational facilities and a mini golf course.

Sri Lanka plans to attract US$ 20 billion in investments to the new port city, on a 15-20 year range.

Wickrama said that Sri Lanka plans to invest US$ 10 billion up to 2020, to develop the ports sector. Since 2008, the Government has invested US$ 2.2 billion to develop the port and related infrastructure.

The SLPA Chief said a marketing campaign is now under way to get major shipping lines to call in Sri Lanka and to attract investors from countries such as the USA, Europe, Middle East, and China to invest in the port sector.

"We are trying to attract, shipping and related industrialists to set up offices in Colombo," he said.

Wickrama said the the Hambantota port and industrial zone has attracted 18 investors with an investment value of US$ 1.8 billion.