China expects fairness in Govt. move to review financial city deal

China yesterday expressed hope that the Sri Lankan Government would be fair in its move to review the scope of the Colombo International Financial City (CIFC), a key attraction of the overall multi-billion dollar Colombo Port City.

In a statement, the Embassy of China in Sri Lanka said that the relevant enterprises highly appreciated the successful visit of Prime Minister Mahinda Rajapaksa and the Sri Lankan team to the Colombo Port City on 7 December. It revealed that during the trip the Prime Minister listened to the briefings and opinions of all parties, extended his strong support to the project and decided to set up a working committee to further study and accelerate the project, including through related legislative work, so as to better benefit the two countries and their people.

“As a follow-up, in the past week the Cabinet of Ministers of Sri Lanka approved the proposal to establish a committee to review and accelerate legislative work on the Port City project,” it said. 

“The Chinese side is willing to guide relevant enterprises to strengthen communication and cooperation with Sri Lanka, under the principles of mutual respect and benefit, fairness and justice. On the basis of the existing framework, the two sides will jointly implement this major project that the leaders of the two countries attach great importance to,” the statement by the Chinese Embassy emphasised. 

Last week the Cabinet decided to review the scope of CIFC, which was earlier set to be established on part of the $1.4 billion Port City project owned by the State, to ensure that it was in line with current political, social and environmental needs.

Cabinet had approved a proposal presented by Prime Minister Rajapaksa in his capacity as Finance, Economic Affairs and Policy Development Minister, which gives the Prime Minister’s Secretary Gamini Senarath the authority to appoint a committee to evaluate the appropriateness and feasibility of the CIFC.     

Eight members will be appointed to the committee. There will be two experts to evaluate the legal implications and one each to consider the economic aspect, urban development scope, study the engineering proposals and consider the provincial regulatory and administrative impact of CIFC. 

An expert will also be added to the committee to analyse the financial and commercial department, along with a professional to look into the possible sociological impact of the project, according to the Cabinet paper. 

However, Cabinet Co-spokesman Ramesh Pathirana told the Daily FT on Thursday that the Government was not considering a significant change to the existing proposal to establish CIFC but the review was to understand the work already carried out and how best it could be used for Sri Lanka’s development. Cabinet approval was also given to construct a $ 1 billion building complex to house the CIFC in December 2017.   

“In 2014, the Colombo Port City development project was commenced by the Ports Authority, with CHEC Port City Colombo Ltd, as a private sector investment. After 8 January 2015, the original scope of the project has been changed as the ‘Colombo Financial City’ and a bill has been prepared under the directions of the legal draftsman and assistance of external consultants to set up a special economic zone ‘Colombo Financial City’.”