[size=33]Malik reveals grand Chinese plans for Hambantota port[/size]
The Hambantota port and the special economic zones attached to it would attract over US $ 9.5 billion in Chinese investments within the next five to six years, Development Strategies and International Trade Minister Malik Samarawickrama told a media briefing yesterday.
The government is hoping to sign an agreement to sell 80 percent of the Hambantota port shares to the Chinese stateowned company China Merchant Holdings for US $ 1.12 billion in January and to utilize the funds to bolster the country’s foreign reserves and repay the high interest foreign loans.
“Within the 1,200-acre Hambantota port there is going to be investments on a cement plant, an LNG plant, an oil refinery and a dockyard. They (China) have agreed and we hope to finish the negotiations soon. So there will be US $ 4 billion in investments there in the next two to three years,” he said.
The minister also added that China Merchant Holdings—which he described as the “world’s number one port operator”— has agreed to invest a further US $ 500-600 million on port equipment such as cranes that are required to expand the port to facilitate the volumes of trade expected.
According to Samarawickrama, currently 60 percent of the profit from the Colombo Port is channelled to cover the losses of the Hambantota port, since there is no shipping traffic into the white elephant project, which was constructed without a viable business plan.
Further, he noted that in the past, the global trade growth has been double the growth rate of global gross domestic product (GDP), but in 2017, the global GDP is expected to grow by 2.5 percent year-on-year, with global trade envisaged to expand at just 0.8 percent with respect to 2016.