Plan for luxury city suspended; Cabinet committee to review project amidst fears over possible loss of Galle Face

The US$ 700 million Chinese-backed 500 acre project to create a new city on reclaimed land from the sea overlooking the Galle Face Green, exclusively revealed in The Sunday Times last week, has been suspended.

A high-ranking source said yesterday that the move followed a “high-level” order and added that the matter would now go for scrutiny before the standard Cabinet Appointed Review Committee. “They will determine whether or not the project proposal should be accepted by the Cabinet,” the source said.
The move, the source pointed out, was the direct result of revelations made in the Sunday Times.
The source declined to comment on who had issued the suspension order or whether other proposals, if any, would be subjected to Cabinet scrutiny.

No other details of why the decision on the offer is being re-considered were immediately available or accessible due to the secrecy surrounding the project, which has been on the drawing boards for more than a year and first announced by President Mahinda Rajapaksa at last year’s UPFA May Day rally.
But he said a similar procedure of seeking Cabinet approval was followed in the case of the Hambantota Harbour and Mattala Airport projects when awarding the contract. President Rajapaksa’s May Day announcement shocked residents in Colombo and drew protests and concern from them and environmentalists fearing that the famous Galle Face landmark would be lost.

However, the plan was to build on a sea area between the new section of the Colombo harbour (breakwater) stretching only up to the old Parliament (now Presidential Secretariat) which will not cover the popular seafront promenade which has drawn millions of Sri Lankans for a quiet, breezy evening with their families.

The securing of the US$700 million investment was itself announced by Sri Lanka Ports Authority (SLPA) Chairman Priyath Wickrama at a public forum on shipping recently in Colombo. But he didn’t disclose the identity of the investor or the country of origin — which the Sunday Times did, in last week’s report. Our lead story said the decision to accept the offer from a Chinese investor was in line with China’s increasing involvement in the Sri Lanka economy as the country’s biggest and most powerful trade partner and financial backer.

The Port Chief said the reclaimed land investment would be on a 99-year lease while other Government officials who spoke to the Sunday Times said it would be an outright purchase in keeping with the new state policy of discontinuing with lease pacts. Agreements for the landfill and construction of the new city would be signed soon in a project stretching up to 2014.

The Sunday Times reported that the re-developed land would then be offered to other investors and the private sector, by the Chinese developer under the guidance of Government agencies which would be responsible for the entire design of the project.

However, the source said, now the Cabinet-appointed committee would also review the whole project along with the offer made by the investor.


Source: Sunday Times