Colombo Port City project : ‘Laws and investments in place soon’ | Sunday Observer

Colombo Port City project : ‘Laws and investments in place soon’

15 December, 2019

The Colombo Port City which is now open for investments will have laws and investments in place soon for a vibrant financial city in the region that will transform Sri Lanka’s business landscape and accelerate economic growth, said Senior Economic Advisor to the Prime Minister and former Central Bank Governor Ajith Nivard Cabraal.

He said a major area of work with regard to the infrastructure of the project has been completed and when the project reaches full completion it will have tremendous potential for investments that will boost the economy which will notch over six percent growth next year and thereafter.

“The last inspection showed that most of the work has been done except for some work on roads and services on which work is progressing. We expect an investment of around US$ 400 million to come for the construction of an office, retail and apartment towers,” Cabraal said, adding that laws governing the land mass and financial activities is being looked into by the Attorney General’s Department and when that has been sorted there will be tremendous opportunities for economic growth in the country. However, ecological concerns and demand for energy and utilities have weighed in heavily on the landmark project which environmentalist and industry experts have warned of the dire consequences of port city projects on coastal and marine life. On the current status of the economy, Cabraal said the new government is doing its utmost to restore confidence in the economy which had eroded badly during the past five years resulting in investments drying up and the economy hitting rock bottom.

“Economic growth which was around seven percent in 2014 has slumped to around 1.5 percent now which is an unacceptable situation that needs to be rectified. The new government has come up with a five-year strategic plan to stimulate economic growth,” Cabraal said, adding that measures have been taken to stabilise the rupee, exchange rate and get businesses to flourish by which there will be more money in the hands of people to invest. The five-year plan includes maintaining the unemployment rate at below four percent, containing inflation below 5 percent per annum, a below four percent budget deficit, single digit interest rates and sustaining the value of the rupee at a stable level.

He said this is why the new government introduced a host of tax concessions to incentivise locals and foreigners to invest, which will help create economic activity in the country.

With regard to the program with the IMF he said the government will commence renegotiations with the donor as certain clauses entered into by the previous government thwarted economic growth.

“We will resume discussions with the IMF and come up with the feasible program that will benefit the country and help accelerate economic growth in line with the new government’s development program,” he said.

The government according to Cabraal will look at fresh free trade agreements in line with the thinking of the president spelt out in his election manifesto that all agreements with outside countries will based on features that will benefit the people and the country at large.

“We will certainly look at new FTAs but will not rush to enter into new agreements that are not beneficial to the country. If there are agreements attractive for the country certainly we will go for them,” Cabraal said. On the bond scam he said a proper independent investigation into the Treasury Bond scam will be launched to take to task all the perpetrators responsible for the brad day light robbery. There were those who added and abated the scam and all those behind the scene will be brought to book,” Cabraal said.