Cargo Business Newswire

Wednesday, September 17, 2014

China launches $1.4B port in Sri Lanka

Chinese President Xi Jinping traveled to Sri Lanka this week, launching the construction of the Chinese-backed $1.4 billion Colombo Port City as he promotes his vision to revive a maritime silk road to combat increased competition from Japan and India.

Sri Lanka is a midway point on one of the world's busiest international shipping lanes. China has bested India to become the largest investor in Sri Lanka.

The Port City will be built by a unit of state-controlled China Communications Construction Co. on 576 acres of reclaimed land. The offices, hotels, apartments and shopping centers will draw as much as $20 billion in investment over about 15 years, according to ports authority chairman Priyath Wickrama.

Colombo's port is the only one in South Asia that can accommodate 18-meter deep draft vessels, which means it could potentially serve the Indian subcontinent, the Middle East and some African states, according to Parakrama Dissanayake, former chairman of the Chartered Institute of Logistics and Transport in Sri Lanka.

President Mahinda Rajapaksa welcomed Xi to Sri Lanka. During Tuesday's visit they commissioned the last phase of the $1.3 billion Norochcholai Lakvijaya power plant, which was funded by a Chinese loan, and signed more than 20 bilateral agreements, including plans to pursue talks on a free trade agreement.

Xi will inaugurate the Colombo Port City on Wednesday. Artist renderings of the development show a palm-lined walkway and a yacht-filled marina constellating what will be the island's tallest skyscraper.

For more of the Bloomberg story: bloomberg.com

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