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Concerned but confident investments are secure; China awaits President
Chinese investors this week expressed concern over the suspension of a string of projects by the Sri Lanka Government, but State officials are optimistic that policies on Chinese investments in Sri Lanka will not alter due to political change.
The concerns were expressed ahead of President Maithiripala Sirisena’s scheduled visit to China next week, where he is expected to meet his Chinese counterpart Xi Jinping.
China Harbour Engineering Company Ltd, Vice President, Tang Qiaoliang (centre) and other officials meeting the visiting Lankan journalists
President Sirisena arrives in China on March 26 to attend the annual Boao Forum for Asia (BFA) – which provides a platform for dialogues between leaders of national governments, industrial, business and academic circles of countries in Asia and other continents.
Ahead of the President’s visit, investors and State officials shared their concerns regarding the suspension of Chinese projects with a team of visiting journalists from Sri Lanka.
“Investors are concerned about the suspension of the projects. It can have an influence on investors,” says Deputy Director General O.U. Xiaoli of the Western Region from where investors are interested in projects in Sri Lanka.
“Investment policies need to be more consistent for investors to make their decisions,” he noted.
He said that one of the companies which was concerned was one preparing to import marine products from Sri Lanka.
One of the major concerns, however, has been the suspension of the US$ 1.4 billion Colombo Port City project, where the company is awaiting Sri Lanka’s response on the project. The issue is expected to figure during next week’s meeting between the two Presidents.
As President Sirisena this week said that further environmental reports regarding the project were due, the company involved in the construction maintained that they had submitted all relevant documents, licences and environmental documents provided to them by the Sri Lanka Government, for review.
“All the documents and licenses provided by the government are legally binding. We were told by the government that they had been cleared by the Attorney General’s Department,” said China Harbour Engineering Company Ltd, Vice President, Tang Qiaoliang.
He said the company had entered into the project under a Public-Private Partnership (PPP), under which the Sri Lankan Government and agencies under the ministry would provide certain documents.
He said the company had sent out a detailed response on March 9 to the Government and were awaiting a response.
Mr Qiaoliang said that the company was willing to comply with legal regulations and had suspended the project at the Sri Lankan Government’s request, to cooperate with the investigations.
In a related development, the Company on Friday was granted permission to carry out a protective construction on the site where some 200 metres of breakwater was constructed under the project, as steps could not be taken to protect the reclaimed land. The Company, in a statement said that, as a result of the suspension of the project, the initial direct loss to the Company per day was over US$ 380,000 (Rs 50 million).
Deputy Director General of the Asian Department of the Ministry of Foreign Affairs, Huang Xilian expressed hope that, despite the change of government, they were confident of future cooperation between the two governments.
Referring to the Port City project, he said, “Hopefully the matter would be handled in a proper manner.”
Li Youngsen, Deputy Director of the Foreign Affairs office in Shangdong province, from where trading between Sri Lanka and China takes place, said that one of the concerns of the investors has been the risk. “Hope Sri Lanka can provide a good environment for investment,” he added.
“Some of our companies were due to visit Sri Lanka on investments, but they are worried that the policies will change,” he said.
China has also submitted a proposal for a project estimated at US$ 760 million, to upgrade the Kandy-Colombo railway line and nine railway stations including the Fort railway station.