Sri Lanka to sign $2 bn worth investment deals

Sri Lanka is set to sign investment deals worth $2 billion on the sidelines of the Commonwealth summit here Thursday, an official said.

Investment Promotion Minister Lakshman Yapa Abeywardana told reporters that the deals would be signed with an Australian company and two Chinese companies, Xinhua reported.

China Communications Construction Company (CCCC) will sign preliminary agreements to build a port city redefining the shoreline of capital Colombo at an investment of $1.3 billion.

A second agreement will be signed between Sri Lanka's Board of Investment (BOI) and Hong Kong-based Evic International Engineering and Nice View Investment for a $250-million multi-development project that will also include a block of apartments in Colombo.

The third project that will be inked is Australia's Property Alliance Capital, which will funnel $450 million in another mixed development project, including apartments, commercial buildings, malls and a multi-level car park in the heart of the capital.

"Sri Lanka has already reached $1 billion in investment so far this year. With the signing of these deals, Sri Lanka is meeting its goal of attracting $2 billion S. dollars in foreign direct investment for 2013," said Abeywardana.

The port city project, which aims to reclaim a 230-hectare site from the sea to build a mini-city that is expected to include a Formula One racetrack, is projected by the Sri Lankan government to attract $15 billion in investment for the country.

The state-run Sri Lanka Port Authority (SLPA), who are overseeing the venture, are preparing to present the project for cabinet approval before the end of the month, SLPA sources told Xinhua.

The 39-month long construction project will also include eco-parks, residential areas, offices and shopping malls, according to the SLPA.

It will be adjacent to the Colombo harbour, which is also being expanded by a Chinese company.

The new real estate will be among the most sought after locations in Colombo and is adjacent to star-class hotels including a $500-million Shangri-la hotel, which is under construction.

Since Sri Lanka ended a 30-year war in 2009, China has emerged as its largest loan provider funding massive infrastructure projects of highways, railways, a coal power plant, an airport and a harbor that are estimated to be worth around $4 billion.