HPDP presented to Cabinet today

Published : 9:10 am  July 24, 2017 | No comments so far |  | 

(343)

 reads | 

CMPHC will invest US$ 1.12 bn to make it the busiest ports in the region

By Sandun A. Jayasekera
The much awaited Framework Agreement of the Hambantota Port Development Project (HPDP) would be presented to the Cabinet tomorrow (25) by Ports and Shipping Minister Mahinda Samarasinghe, the Daily Mirror learns.

It is also learnt that, the Framework Agreement to Re-develop Magampura Port in Hambantota as a Public Private Partnership (PPP) would be signed in a month following the Cabinet nod between the Sri Lankan Government and China Merchant Ports Holding Company (CMPHC) affiliated to the Chinese Government.

DM_20170724_A001-2
Accordingly, 80% of the ownership of Hambantota port will be transferred to the CMPHC and the Chinese company will invest US$ 1.12 billion to revive and develop Magampura Port as one of the busiest ports in the region.


The $1.5 billion project, initiated by the Mahinda Rajapaksa regime had run into many controversies. The region will also become a 1,200 acre Chinese investment zone.


The first phase of Hambantota port was built with Chinese investment and the second phase development was suspended by the Yahapalana Government citing many shortcomings and allegations.


China granted a loan of US$1.4 billion to construct a breakwater, a tank farm, a bulk cargo jetty, an artificial island and container berthing space at the Hambantota Port.


President Maithripala Sirisena in May appointed a three member Cabinet Sub Committee comprising Special Assignments Minister Dr. Sarath Amunugama, Megapolis and Western Development Minister Patali Champika Ranawaka, International Trade Minister Malik Samarawickrema, Ports and Shipping Minister Arjuna Ranatunga to look into the implementation of the deal, which drew many protests from among the Government ranks and the Opposition.


Subject Minister Ranatunga himself had reservations particularly on the leasing out of 1,235 acres of land adjacent to the port on free hold for 99 years and prohibition of armed forces personnel in any activity in the port. The CMPHC has finally agreed to give an option for Sri Lanka to buy a 20% stake of the HPDP within 10 years of signing the agreement, increasing Sri Lanka’s stake to 40%. The CMPHC will make further investments to purchase equipment for port operations as Sri Lanka has no capacity to make further investments to make the Hambantota port a fully fledged international port.

 

 

(343)