Colombo, July 28 (newsin.asia) – Sri Lanka’s Prime Minister, Ranil Wickremesinghe, on Friday said that Sri Lanka would sign a deal with China on the development of the Hambantota Port, in southern Sri Lanka, on Saturday.
Speaking at a media briefing in Colombo, Wickremesinghe said the agreement with China Merchants Port Holdings would bring in 1.1 billion US dollars and the agreement would be beneficial for the island country.
“We will sign the Hambantota agreement tomorrow. We are giving the country a better deal without debt,” Wickremesinghe told journalists.
Ports Minister, Mahinda Samarasingha, earlier this week said that under the agreement, China would own a 70 percent stake of the Port while Sri Lanka will own 30 percent.
Samarasingha said that cabinet had granted approval to enter into the agreement and this would be a win-win situation for both countries.
China will invest 1.12 billion US dollars for its 70 percent stake and will also manage the operations of the Port. Sri Lanka will manage the security of the Port along with the navigation and approvals.
Samarasigha said all foreign naval vessels could call at Hambantota Port as they did at the main port in the capital Colombo as the island country wanted to maintain good relations with all countries.
He added that although negotiations with China Merchants Port Holdings took a long time, all matters regarding the agreement had been thoroughly discussed for the benefit of both China and Sri Lanka.
He further explained that after 10 years, if Sri Lanka wished to purchase an additional 20 percent stake of the Port, they could do so by purchasing it, resulting in China and Sri Lanka owning an equal share of 50 percent each.
China is Sri Lanka’s largest Foreign Direct Investor with many mega projects including the construction of a 1.4 billion dollar Port City close to the Colombo Harbour.