Hambantota port agreement to be further amended

USD 5 million has already been deposited to a special account as security and it is to be transferred to the Sri Lanka Ports Authority (SLPA) on the effective date of agreements. The Hambantota port agreement is to be further amended and cabinet approval has been obtained to sign the amended agreement.Cabinet spokesman Gayantha Karunatillake said that the amended agreement will ensure Sri Lanka obtains the agreed investment of the project much earlier. On 25th July 2017, China Merchants Port Holdings Company Limited (CMPort), Sri Lanka Ports Authority (“SLPA”), the Government, Hambantota International Port Group (Private) Limited (“HIPG”) and Hambantota International Port Services Company (Private) Limited (“HIPS”) had agreed on the terms of the Concession Agreement in relation to the development, management and operation of the Hambantota Port.In the signed agreement CMPort agreed to invest an amount of up to USD 1,120.00 million into the Hambantota Port and Hambantota port and marine-related activities.Of this the total amount is to be paid to SLPA for the acquisition of the 85% issued share capital of HIPG is USD 973.658 million (and HIPG shall use a portion of such amount to acquire 58% issued share capital of HIPS) and the remaining USD146.342 million (equivalent to approximately HKD1,141.47 million) is to be deposited into a bank account in the name of the Company in Sri Lanka and will be utilised for such Hambantota port and marine-related activities as may be agreed with the Sri Lankan Government within one year from the final payment of capital injection in HIPG. The Port of Hambantota is located on the Southern coast of Sri Lanka occupying a prime location within 10 nautical miles to the main shipping route from Asia to Europe and is also in a strategic position along the “Silk Road Economic Belt and the 21st Century Maritime Silk Road”. (Colombo Gazette) After one month from the effective date 10% of investment value (01 instalment) should be paid, 30% of value should be paid after 03 months (02 instalments), rest 60% of value should be paid within 06 months (03 instalments). On the request of government CMPort has agreed to amend these agreements on follows, to pay 30% (01 instalment) on the effective date, pay 10% after one month (02 instalments), pay rest 60% within 06 months (03 instalments).It has been decided to sign an additional agreement in this regard. read more