Minister of Ports Bimal Rathnayake has revealed that concerns over the agreement to allocate 10 acres of land at the Colombo Port were among the reasons behind the government’s opposition to the proposed USD 280 million logistics project involving a Chinese company.
Speaking in Parliament, the Minister said the agreement involved allocating 10 acres of land located between the East and West Container Terminals at the Colombo Port to the logistics company.
He explained that while the government supported the proposed investment, it had concerns over the manner in which the agreement had been reached.
The Minister said he had personally worked to facilitate the project after assuming office, including bringing senior officials of the company to Sri Lanka for discussions.
“We held several discussions with company officials and made it clear that we supported the investment. However, we could not proceed under the existing agreement, as the proper procedures had not been followed,” he said.
Responding to allegations that the government’s actions had driven away investors, Minister Rathnayake rejected the claims, arguing that proceeding with investments under questionable agreements could discourage other potential investors.
His remarks come after the Sri Lanka Ports Authority (SLPA) confirmed that the proposed USD 280 million logistics project at the Port of Colombo would not proceed.
The project was to be implemented through South Asia Commercial and Logistics Hub (SACLH), a joint venture established in 2023 involving China Merchants Port Holdings Company Limited, which held a 70% stake, while the SLPA and Access Engineering PLC each held 15%.
According to the SLPA, the shareholders decided to discontinue the project following a review of external circumstances, commercial considerations and their respective interests.
The Authority also confirmed that approximately USD 29.8 million in equity contributions would be refunded to the shareholders in proportion to their stakes, subject to regulatory requirements and operational expenses.
Meanwhile, the SLPA has announced plans to develop an alternative logistics hub at the Colombo Port under a Public–Private Partnership (PPP) model, with investors to be selected through a competitive bidding process. (Newswire)
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