Sri Lanka, China Merchants sign agreement to build South Asia’s largest logistics hub

China Merchants Port Holdings, Access Engineering Company and Sri Lanka Ports Authority yesterday (21) signed a historic agreement to build the largest trade and logistics hub in South Asia.

China Merchants Port Holdings announced that it is teaming up with Sri Lanka’s Access Engineering and the Port of Colombo to set up a logistics center as a BOT (Build Operate Transfer) project.

This project is carried out jointly by the public and private sectors. After 50 years, the project will be fully handed over to the Sri Lanka Ports Authority (SLPA).

The total investment for this project is US$400 million and it is expected to increase investor confidence.

China Merchants Port Holding Company will invest 70% of the money for the projects, while the government and Access Engineering will invest 15% each.

This investment, signed yesterday, is the largest investment since the Covid-19 pandemic, said Nimal Siripala de Silva, Minister for Ports, Shipping and Aviation.

On this occasion, the minister expressed his gratitude to the Chinese government for its help in restructuring Sri Lanka’s debt.

Mr. Miao Tianmin, the Chinese company’s chairman, said his company invested US$400 million in the CICT Jetty in 2019 when no other investor came forward. He added that he hopes to make similar investments in Sri Lanka in the future.

SLPA Chairman Keith D. Mr. Barnard said the project will be connected to Bandaranaike International Airport via the Airport Expressway by the end of this year.

Upon signing this agreement, an initial amount of US$126 million will be paid in, with an additional US$126 million paid out. The project is expected to create 1,800 direct jobs and 10,500 indirect jobs.

The project will increase container handling capacity and also help other jetties. This creates all the opportunities to increase international trade.

Mr. Sumal Perera, the company’s chairman, said that Access Engineering Company has been working with the port for many years.

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