Aug 2 (NIA) – Chinese investors responsible for constructing a multi billion dollar port City project in capital Colombo have agreed to drop a compensation claim due to a one year delay in the project, and in return the government will give them two additional hectares to cover up for the loss, Sri Lanka’s Media Minister, Gayantha Karunathilleke said on Tuesday.
Earlier, the China Communications Construction Company Ltd (CCCC), had claimed for compensation valuing 125 million US dollars due to the government’s decision to halt the project for a period of one year.
“In view of the goodwill created by the visits of His Excellency the President and the Hon. Prime Minister to China, the project company has agreed to withdraw all compensation claims for losses incurred due to the suspension of the project caused by the failure of the previous administration of the SLPA to obtain the required environmental permits,” the Minister reading a cabinet paper informed journalists.
“In their original Master Plan there was provision for night racing. They had fully abandoned that plan at present. In view of this, a large extent of marketable land becomes available. Out of this, 2 hectares may be allocated to them, without reducing the land extent of 62 hectares owned by the GOSL. This will be a gesture to reciprocate their goodwill in completely waiving off all compensation claims.”
The project which is Sri Lanka’s biggest foreign direct investment, was launched by former President Mahinda Rajapakse in September 2014. It was however suspended six months later by President Maithripala Sirisena who defeated Rajapakse in a presidential election in January last year.
The Sirisena regime had ordered for a review of the project and had also ordered for an Environmental Impact assessment.
A year after its suspension, the government finally gave a nod for the project to continue in March this year stating that the Port City would become a business and financial hub. The government further explained that the Port City would function as a special jurisdiction area with its own economic and commercial laws to facilitate operations of global multinational corporations.
Reports however alleged that the Chinese company had claimed for 125 million dollars as compensation over the suspension with Sri Lankan Prime Minister Ranil Wickremesinghe claiming that the government need not pay the compensation.
The Prime Minister further said that said the matter of compensation was not raised during his visit in China in April and assured that it would be solved easily.