$1.5bn Colombo Port City is back on track, perhaps

After a flurry of diplomacy and an apparent government u-turn last week in Sri Lanka, the $1.5bn Colombo Port City scheme may be going ahead after all.

In January Sri Lanka’s new government said it would comprehensively review a Chinese-backed $1.5bn deal to build a brand new port city offshore Colombo over concerns about a Chinese company controlling land in a high-security zone.

But on 5 February the Sri Lankan cabinet said the project would go ahead after it had considered the feasibility study and the environment impact assessment. Its aim was to avoid "creating a misunderstanding" with the Chinese government, according to local press.

On 6 February, China’s assistant minister of foreign affairs, Liu Jianchao, arrived in Sri Lanka for talks with president Maithripala Sirisena (pictured), who was sworn in on 9 January after winning a general election. During his campaign he had said his government would be less accommodating to Chinese interests.

Liu promised that China would not interfere in Sri Lanka’s domestic affairs or use Sri Lanka as a hub to operate against any other country, local media reported. India is concerned about security issues raised by Chinese ownership of the freehold of 20 hectares of land next to the main commercial port in Colombo, which India uses as a trans-shipment port.

The China Communication Construction Company (CCCC) signed a deal with the Sri Lanka Ports Authority in July 2013 to develop the port city on 230 hectares of reclaimed land just offshore Colombo. CCCC’s subsidiary, China Harbour Engineering, began reclamation work in September 2014 after an inauguration ceremony attended by Chinese president Xi Jinping and Sri Lanka’s then-president, Mahinda Rajapaksa, who lost the January election.

There is still some confusion, however, surrounding the exact status of the project. On 7 February, Sri Lankan newspaper The Nation reported that Sri Lanka’s prime minister, Ranil Wickremesinghe, had told parliament that day that two committees of experts would carry out a probe on the scheme, following objections raised by the opposition People’s Liberation Front party (JVP).

"I got down all the files relating to this project. When I inspected them, I found that all the required reports are not there. There is a deficiency in the environment impact assessment," he said, according to The Nation.

GCR was unable to confirm the project’s status with the Sri Lankan government as of press time.

Photograph: Maithripala Sirisena was sworn in as President of Sri Lanka on 9 January (Government of Sri Lanka)

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