Feb 28, Colombo: The Cabinet of Ministers has decided to suspend the signing of the Millennium Challenge Corporation (MCC) agreement after considering the recommendations made by the committee appointed to review the agreement, co-cabinet spokesman Minister Bandula Gunawardena said.
The Minister made this announcement at the press briefing held at the Government Information Department today (28) to announce cabinet decisions.
Following a decision taken by the cabinet of Ministers of the new government on December 18, 2019, a four-member committee was set up with effect from January 1, 2019 to review the MCC Agreement and make recommendations to the Government on the action to be taken.
The special committee was headed by Professor Lalithsiri Gunaruwan of the University of Colombo and comprised former Secretary to the Ministry of Transport DS Jayaweera, President's Counsel Nihal Jayawardena and Architect Nalaka Jayaweera as members.
The committee has submitted an interim report to the Prime Minister Mahinda Rajapaksa.
The Committee in its report has pointed out that although the MCC proposal includes the ability to raise the financial resources needed for investment in mitigating basic economic constraints of Sri Lanka burdened with debt and lacking capital resources, some of the projects proposed to be included in the program will have significant adverse impacts on the national, social and economic well-being of Sri Lanka.
The Committee has also pointed out that the Corporate Agreement and Program Implementation Agreement between the United States Millennium Challenge Corporation and the Government of Sri Lanka as well as the draft constitution of the proposed company to be established include clauses and provisions which may be inconsistent with the Constitution of Sri Lanka and the legal system of the country and conditions which could potentially affect national objectives, sovereignty and national security.
The Committee has pointed out that it is imperative to make appropriate corrections and amendments to such adverse elements and it is appropriate to seek the public opinion on the relevant conditions and project proposals and obtain the approval of Parliament.
The Prime Minister has presented the interim report of the Committee to the Cabinet of Ministers for their information and the Cabinet of Ministers has considered its findings, preliminary inferences and recommendations.
The US$ 480 million grant under the MCC Agreement was proposed to utilize to upgrade the transportation infrastructure and improve land management, covering the entire country.