COLOMBO: Sri Lanka on Saturday signed a long delayed deal to lease its southern Hambantota port to China.

The much debated $1.12 billion deal was signed by the Sri Lanka Ports Authority (SLPA) and the China Merchant Port Holdings Company (CMPort) in the presence of the Sri Lankan Ports Minister Mahinda Samarasinghe, Finance Minister Mangala Samaraweera, and Senior Minister of Special Projects, Dr Sarath Amunugama.

Executive Vice President of the partner company China Merchant Group (CMG), Dr Hu Jianhua declared that the Hambantota port built with Chinese expertise will be a significant part of China’s One Belt One Road (OBOR) global communications project while Minister Samarasinghe explained the changes made in the amended agreement, in relation to the earlier envisaged pact.

The amended agreement secures for the Hambantota port, $1.12 billion as upfront payment from the Chinese partner CMPort, which will enable the SLPA and Sri Lanka to partly set off their debt obligations to China.

The amended agreement gives the SLPA a 30 per cent stake in the port, in contrast to 20pc, which it was supposed to get earlier under the December 2016 Framework Agreement. CMPort will get 70pc stake and not 80pc as granted earlier. The security of the port would be entirely under the control of the SLPA, the Defense Ministry and the Sri Lanka Navy where warships could land but only with the explicit permission of Sri Lanka. The agreement was inked without being passed in parliament on Friday because of a commotion created by the opposition.

The Ports Minister explained that the agreement that was signed would be presented to parliament again, because some might charge that it is different from the one presented on Friday, pointing out that it is not ‘cast in stone’ and ‘can be amended at any time with the consent of both the parties.’

The Executive Vice President of CMG, Dr Jianhua, maintained that the signing of the agreement is “very significant” as it marks the 60th year of the establishment of diplomatic relations between China and Sri Lanka highlighting that the Hambantota project is the largest maritime communication project in Sri Lanka, to date.

Meanwhile former Ports Minister Arjuna Ranatunga who has been opposed to the deal, wanting a 60pc stake for the SLPA and not 80pc or 70pc, did not attend the ceremony.

The framework for the agreement signed last year sparked widespread public anger as CMPort was to get 15,000 acres on lease for 99 years to develop an adjoining industrial zone.

Published in Dawn, July 30th, 2017