Port City corrects State Minister Semasinghe; denies various allegations

With reference to the Daily FT Page 1 article of 13 January and few other reports quoting State Minister of International Trade Sujeewa Senasinghe, CHEC Port City Colombo Ltd. Managing Director Jiang Houliang has sent the following response to the Senasinghe with copy to the Daily FT:

We wish to draw your attention to the very first bullet point contained in the said article appearing in the Daily FT newspaper, which ostensibly refers to a statement supposedly made by you, in your capacity as the State Minister of International Trade, in which you are reported to have stated inter alia “State Minister says re-evaluated project purged of corruption”. 

We also wish to draw your attention to the second paragraph of the said article, which appears as excerpt of a another statement reported to have been made by you in your capacity as the State Minister of International Trade, in which you are reported to have said “We have cleaned up the Project. There are no commissions and issues with the project.”

Similarly, in websites you are quoted as allegedly stating inter alia that the project has been downsized by the Government having studied the full project. Further, you are quoted as allegedly stating that the Government has decided to take the “corruption part out of it”.

It is further alleged that you have made several other statements indicating that the Port City Project is tainted and/or replete with corruption.

Further, in page two of the said Daily FT Newspaper, it is stated that you, as the State Minister of International Trade has stated as follows: “The Minister also alleged 50 acres of the land was earmarked to be handed over to a prominent family of former President Mahinda Rajapaksa’s Government.”

In addition a similar news item containing statements allegedly attributed to you stating inter alia “50 acres was supposed to be given on a private deal; that was not for the Government. We will remove them. To do so we have to change the agreement.” Further, in the interview you have given which is now available on YouTube, you state inter alia that “commissions” have been removed from the Port City Project.

In our view, a plain reading of the afore-quoted paragraphs and the statements referred to above attributed to you convey to the readers the incorrect and/or inaccurate message that the Port City Project was tainted and/or replete with corruption and ‘commissions’ until the incumbent Government ‘cleaned’ up the Project.

The said statement attributed to you, which induces the Reader to arrive at the irresistible conclusion that the Project has been secured by the Project Company by offering bribes and/or commissions and/or other such financial inducements, also creates the impression that the Project Company has been involved in corrupt practices. In response we wish to categorically emphasise the fact that the Project Company has not been involved in any form of bribery and/or corruption to secure the said Project. It has never been the policy of the said Project Company to secure projects by resorting to bribery and corruption.

In this respect we wish to categorically state:

l. The investor in the Colombo Port City project, China Communications & Construction Company (CCCC), a Global Fortune 500 company that is listed on the Hong Kong Stock Exchange and governed by high ethical standards.

2. CCCC or the Project Company has never engaged in corrupt and/or fraudulent practices in connection with the Port City Project or any other project.

3. The Project Company has not up to now agreed with the Government to downsize the project.

We wish to state further that, pursuant to the new Government being sworn into office, from or about March 2015, the Project has been under suspension on a directive of the Government. According to the information we have received, the directive to so suspend the project was made on the premise that the necessary approvals and permits were not in place to commence the reclamation works. After being informed of the said suspension, we have brought it to the attention of the Government that the contractual obligation to obtain the necessary approvals and permits is with the Government in terms of the Project Agreement.

That said, whilst under suspension, every aspect of the Project has been scrutinised and/or reviewed by different Committees comprising of Government Officials, Technical Experts, Environmentalist and Other persons having knowledge and experience pertaining to the implantation of Projects of this nature and magnitude. However, not an iota of evidence surfaced which suggested that the Project Company has offered any bribes and/or has been involved in corrupt practices to secure the Project. 

Further, after the new Government was sworn in, the validity period of the Project Agreement that was signed between the Project Company and Government of Sri Lanka on 16 September 2014 has been extended on or about 17 September 2015. You would agree that it is unlikely that the new Government would have extended the Project Agreement if in fact the project was tainted with any bribes and/or corrupt practices.

Further, as regards the afore-quoted Statements attributed to you, we wish to place on record that the aggregate investment component of the Project, which is approximately US $ 1.4 billion, is being contributed by the Project Company as our investment in the Project. Hence, it has been agreed between the Government of Sri Lanka and the Project Company that the Project Company should receive a portion of the reclaimed land (20 Hectares on free hold basis and 88 Hectares on a lease hold basis) as consideration for the total investment to be made by the Project Company in reclaiming such land. The balance portion of the land to be reclaimed (approximately 155 hectares) consist of public areas and commercially developable land allocated to the State. The said Project was undertaken by our Company for commercial purposes and it is the aim and objective of our company to commercially exploit the said portion of the reclaimed land which is to be received by the Project Company to recover the investment made by the Project Company and to earn profits.

Thus, as far as the Project Company is concerned, there has been no decision whatsoever to allocate any portion of the land allocated to the Project Company as consideration for its efforts in developing the Project to any “prominent family of the former President Mahinda Rajapaksa’s Government” as alleged. Further, the Government of Sri Lanka has not communicated to the Project Company that the Government intends to allocate a portion of the reclaimed land allocated to the State to someone on a private deal as alleged. In this setting, a statement which purports to say ‘earmarking 50 acres of land with a view to handing over the same to a prominent family’ and other similar statements would completely undermine the entire Project as a Project that has been secured through illegal and/or underhand means. Such a reputation could completely jeopardise the anticipated commercial exploitation of the said Project. Hence, we wish to categorically refute such insinuations and/or allegations which suggest that a certain portion of the reclaimed land was earmarked to be handed over to the members of a prominent family.

In the circumstances aforesaid we humbly request you to publish a correction to the aforesaid newspaper reports and articles published online, giving equal publicity to the explanations given herein above, that might help clear any doubts and/or misconceptions the readers might have entertained regarding the manner in which the Project Company has conducted itself in securing and/or executing the Project. In the event you require further clarifications in this regard, we would be more than obliged to provide you with the same, as statements based on misunderstandings and/or misconceptions might cause irreparable harm and./or prejudice to the Project, which the GOSL is keen to keep on track in the national interest.