Discrepancy in facts and figures publicly announced by the government in the Colombo land deal involving Hong Kong based Shangri-La hotels and state-run China National Aero Technology Import and Export Corporation (CATIC) from time to time has created confusion as the total sales proceeds cannot be traced in Treasury’s general account number 6000, hotel industry analysts said.
Although a deputy minister has announced that a sum of US$ 261.5 million had been received from the two deals, there was no record to prove it in Treasury accounts, they added.
At a press conference on Wednesday, Deputy Economic Development Minister Lakshman Yapa Abeywardane said a sum of US $ 261.5 million received by the sale of the 20 acre land to the Shangri-La and CATIC companies had been deposited in the Treasury’s general account number 6000 in a transparent manner. Cabinet approval had been received for this project and the gazette notification also issued, he said.
However when contacted by the Business Times, Mr Abeywardane said that Shangri-La has paid US$ 75 million initially to buy six acres of land and US$ 50 million thereafter, for another four acres totalling US$125 for 10 acres. He said that upon re-assessing the value of land adjacent to the Shangri-la land with the impact of its development by Shangri-la, the other 10 acres of land was given to the Chinese Company CATIC for US$ 136.5 million. The total amount received by the government from these two deals is US$ 261.5 million. He told the Business Times that a Bank of Ceylon cheque to the value of US$125 million given by Shangri-La had been deposited in the Treasury General account number 6000.
A letter sent by Secretary to the Treasury Dr. P.B Jayasundara confirming the payment was forwarded along with other documents to the Land Registrar to transfer the deeds, to Shangri-La, he revealed.
However the amount of US$125 million paid by Shangri-La was not in the Government gazette No 1700/4 dated 5th April 2011 although Mr Abeywardane claimed that all the details had been included in the gazette. The gazette notification says that the total investment of Shangri-La for the project was US$283 million. But all the details including the money paid by Shangri-La are only included in the Government gazette No 1700/5 dated 5th April 2011 where it is stated that the company paid a sum of US$3.5 million to buy a private land in Hambantota for their Hambantota hotel and the total investment is US$109 million.
Asked about this discrepancy, Mr. Abeywardane said the Treasury has confirmed the payment and all these documents were tabled in parliament. But according to official sources, only a sum of US$ 76 million was recorded in the Treasury ledger. “We want to know how the sale proceeds of Shangri-La and CATIC at Galle Face are being accounted for.
We are not accusing anyone of anything quite yet, but we are unable to see the proceeds of sale in the treasury accounts. We want full transparency in these privatizations,” economic expert and UNP MP Dr. Harsha De Silva told the Business Times. If by any chance the accounts are off-balance sheet then the expenditure can also be off balance sheet, he added.
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