Sri Lanka’s government could get a minimum of 1,500 million US dollars from the sale of reclaimed land leases in Colombo Port City, thought actual earnings are likely to be higher, State Minister for Money and Capital Markets Nivard Cabraal said.
Sri Lanka’s share of the land reclaimed by China Harbhour Engineering Corporation was 62 hectares.
“Based on current valuations Sri Lanka’s share could bring 1,550 million US dollars,” Minister Cabraal said.
“But the actual income would be much higher because the sales are made at different times.”
There have been criticism that the Port City had too many tax breaks.
The buildable land in Colombo Port City would be made in stages and the land value is likely to be enhanced as part of the city is built and is operating, he said.
The Colombo Port City Commission in addition would get a 1 percent fee from all land sold by China Harbhour, Minister Cabraal said.
CHEC is spending 1.4 billion US dollars to reclaim the land and build utility infrastructure.
Sri Lanka on May 20 passed a law to make the reclaimed land a dollarized special economic zone which will be protected from currency depreciation caused by the Monetary Board of the central bank through liquidity injections and the resulting forex shortages and exchange controls.
Helped by monetary stability, which is expected to lay the foundation for a financial centre, and ease of doing business to fast-track business approvals, Sri Lanka is expecting 15 billion US dollars of investments to flow into the special economic zone.
Cabraal told parliament Colombo Port City will and about 4.5 billion US dollars to Sri Lanka’s 80 billion dollar economy in the first few years and 12 billion US dollars when fully operational.