A concession agreement relating to the proposed 80% share transfer of the Hambantota port to China Merchants Port Holdings will be signed in early January 2017.The government is currently in talks with the relevant party to finalise the agreement, Development Strategies and International Trade Minister Malik Samarawickrama said.
The Minister said the framework agreement in this regard has already been signed.
The Minister further added that the proceeds of the deal will be utilised for the best interest of the country in addition to paying off some of the high interest loans obtained by the previous regime to develop the port.
Additional US$ 600 million is required to purchase the necessary equipment to carry out operations at the port, Samarawickrama said adding that China Merchants has also agreed to pay the required amount to this end.
The minister also emphasized that the port will be used only for commercial purposes and only Sri Lanka navy will be allowed to use the port for military purposes if necessary.
Commenting on the deal,the Minister noted the China Merchants has agreed to purchase an 80% stake amounting to USD 1.12 billion of the port while China Harbour has asked for 65% stake to the tune of USD 750 million.
“Having considered the proposals made by the both parties, the government has decided to strike the deal with China Merchants.”
The remaining 20 % stake of the port will be owned by the Sri Lanka Ports Authority and it will be developed as a public, private partnership project.
Quoting a statement made by Ports and Shipping Minister Arjuna Ranatunaga, Samarawickrama said that 60% profits of the Colombo harbour had to be spent to maintain operations at the Magampura port.
He also slammed the previous government for not initiating a proper plan to make Hambantota port a viable venture.
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