Dec 07, Colombo: The government of Sri Lanka has received the approval of the cabinet of Ministers to sign the agreement of share ownership with the China state-owned company before commencing operations in the Hambanthota Port.
On July 29, the amended agreement to expand and develop the Hambantota Port under a public-private partnership was signed between the Sri Lanka Ports Authority (SLPA) and China Merchant Port Holdings (CMPort), Hambantota International Port Group (HIPG) and Hambantota International Port Services (HIPS).
Accordingly, the two companies established to develop the port, namely Hambantota International Port Group (HIPG) and Hambantota International Port Services (HIPS), are scheduled to commence respective operations, according to the said agreement, on December 09, 2017.
As per the agreement, 85% of the shares of Hambantota International Port Group will be held by China Merchants Port Holdings Company Limited or any of its subsidiaries while 15% will be held by the state-owned SLPA.
Meanwhile 58% of the shares of the Hambantota International Port Services will be controlled by HIPG while 42% will go to the SLPA.
Under the 99-year lease agreement, CMPort will agree to invest an amount of up to US$ 1.12 billion into Hambantota Port and Hambantota port and marine-related activities.
The new contract is expected to generate a lot of jobs and an investment zone.