ECONOMYNEXT – Sri Lanka’s Colombo Port City will be a driver of growth and foreign direct investment and concerns over it being a Chinese colony are misplaced, State Minister for Money and Capital Markets, Nivard Cabraal said.
Sri Lanka is facing substantial challenges with rising debt and low growth, and the Colombo Port City will be a source of non-debt inflows that will help drive growth and investments by reducing the hassle faced by investors, he said.
The Colombo Port City has been exempted from a number of laws and agencies to improve the ease of doing business.
“Sri Lanka has dropped in the ease of doing business index in the past few years,” Cabraal told reporters in Colombo.
“In South Asia Sri Lanka is the fourth. Do you really want to go through the hassle of the Pradeshiya Sabha in getting approvals? This will be a one stop shop.”
Efforts were also under way separately to improve the ease of doing business across the country, Cabraal said. Already opinions had been sought from affected stakeholders.
He said it was not fair to say that it will be centre for money laundering. The Colombo Port City has not been exempted from money laundering laws, he said.
The area of Colombo Port City has already been gazetted to be part of the Colombo District by the last administration and it would not be a separate country.
There is lack of clarity whether the resident of the Port City would have a vote. The District of Columbia (Washington) in the US also does not have representation in Congress and has been an issue for decades.
Initially the people who move to the Port City would most likely have a voter registration elsewhere Cabraal said. Others would be foreigners.
Sri Lanka’s Bar Association had also raised concerns that it may affect the the unitary state, the judiciary and the fundamental rights of citizens.
If the Supreme Court decides some provisions could not be allowed, the government will change them.
Cabraal said Colombo Port City had been exempted from the country’s contract law for faster resolution of commercial disputes.
The plan was to attract foreign companies and also create an environment for them to set up corporate headquarters, he said.
Other laws will continue to apply and be treated through the normal courts. There are however provisions for expeditious hearing.
Sri Lanka police will also maintain the peace, he said.
Visas will continue to be approved by the Controller of Immigration and Emigration, he said.
China Harbour Engineering Corporation, which reclaimed the land is a subsidiary of China Communications and Constructions Corporation which is listed in China and Hong Kong stock exchanges.
He said the Chinese partner was keen that non-Chinese foreign investors also come.
“They want investors from all countries to come,” Cabraal said. “In fact when I went to Qatar and Oman we invited investors to come.”
He said the directors of the Colombo Port City Commission would be appointed by President Gotabaya Rajapaska and not China.
They would serve at the pleasure of the President and could be removed by the President, Cabraal said.
The new administration had already scrapped the 20th amendment to the constitution which made the judiciary and public service more independent so that it would act fairly and equally by the people without being pushed by politicians.
Under an earlier draft of the law, some of the commissioners were to have been appointed by the Constitutional Council undergoing some third party scrutiny.
There were also to have been ex-officio representation by the Treasury, Central Bank, the Urban Development Authority and the Board of Investment, opposition legislator Harsha de Silva said.
Cabraal said he saw no need for ex-officio representation.
The Commissioners would be experts in their field, he said.
The Colombo Port City residents and businesses will do business in foreign currency and will be protected from the Monetary Board of the central bank whose policy errors and money printing triggers currency depreciation resulting mass scale impoverishment of the people. (Colombo/Apr17/2021)