By Uditha Jayasinghe
Cabinet has approved legislation that once gazetted and passed in Parliament by President Gotabaya Rajapaksa, an Economic Commission will be established for the $1.4 billion Colombo Port City enabling it to attract investment and function as an international financial city, a top official said yesterday.
President Gotabaya Rajapaksa had presented the Colombo Port City Economic Commission Bill to Cabinet after it was completed by the legal draftsman. The Government has targeted about $ 1 billion in investment from the Port City project for this year, making it a crucial part of Sri Lanka’s push to attract foreign direct investment.
“In January, Cabinet gave approval for the drafting of an Economic Commission Bill for the Port City and we are now getting closer to clearing the legal process for it to become part of Sri Lanka’s law.
We are confident that this project will be taken forward successfully,” Cabinet Spokesman Keheliya Rambukwella told reporters at the weekly Cabinet briefing.
During the presentation of Budget 2021 Prime Minister Mahinda Rajapaksa said the relevant legislation would be presented to Parliament by January but this has been beset by several delays. The Government is expected to give investors attractive tax holidays under the reactivated Strategic Development Projects Act.
The Colombo Port City is projected to contribute $ 11.8 billion to Sri Lanka’s economy per annum upon completion, according to an independent study carried out by PricewaterhouseCoopers.
The Bill will pave the way for the Colombo Port City to be developed as a Specialised Economic Centre with a wide scope of service to the Indian subcontinent and Southeast Asia, and an excellent regional hub aimed at a service economy in line with the Government’s ‘Vistas of prosperity and Splendour’ Policy Statement.
Cabinet in January agreed that for this purpose, it was necessary to create an active environment that could compete with investment hubs such as Dubai, Singapore, and Hong Kong, by attracting investors, entrepreneurs, innovators, companies, financial institutions through a well-structured and competitive legal, tax and regulatory, and dispute resolution mechanism.
The Port City is made up of 269 hectares of reclaimed land, which has now been officially vested as part of Sri Lanka. Of the 269 hectares, 116 hectares belong to China Communications Construction Company (CCCC), which is the parent company of China Harbour Engineering Company (CHEC), on a 99-year lease. The remaining land is owned by the Sri Lankan Government, and will be divided up into 62 hectares, to be used to set up a financial city, and 91 hectares to be used as public spaces.