COLOMBO: With the launching of a Sino-Sri Lankan Joint Venture (JV) to run the China-funded Hambantota port here on Saturday, Sri Lanka has joined China’s One Belt One Road (OBOR) and 21st Century Maritime Silk Route projects, Prime Minister Ranil Wickremesinghe has said.

Speaking at the launching ceremony here on Saturday, Wickremesinghe described the occasion as “historic”, as it will help make the Hambantota port part of Sri Lanka’s grand scheme to turn the island nation into the maritime hub of the Indian Ocean.

Sri Lanka will have three ports – one in the West (Colombo), one in the South (Hambantota), and one in the East (Trincomalee) - to make it an ideal maritime hub of the Indian Ocean Region (IOR), he said.

Wickremesinghe stated that Sri Lanka is now part of China’s One Belt One Road Initiative (OBOR), which, along with its 21st.Century Maritime Silk Route, is an international connectivity project.

Through the OBOR and the 21st Century Maritime Silk Route, Sri Lanka will become a maritime hub as indeed it was in pre-colonial times when the Chinese had a maritime silk route girdling the globe, the Lankan Prime Minister said.

Sri Lanka lost its place in the maritime route because of the disruption of the system by the colonial powers, he explained.

Wickremesinghe further said that the Hambantota port will be part of a larger scheme to make the area around it a hub of industrial activity with a cement plant and an oil refinery coming up in the proposed Economic Zone.

Joint Venture Partners

The Joint Venture is between the public sector Sri Lanka Ports Authority (SLPA)/Government of Sri Lanka and the China Merchant Port Holdings (CMPH).

As result of the Concession Agreement dated July 29, 2017, two companies have been formed to run the Hambantota port – the Hambantota International Port Group (HIPG) and the Hambantota International Port Services Co. Pvt. Ltd.

With US$ 292 million handed in on Saturday the CMPH has given, as down payment so far, 40% of the total of US$ 1.2 billion pledged to the port as per the Concession Agreement. Ten percent had been paid earlier.

Hambantota port will be the largest multi-purpose port in Sri Lanka and also the island’s single largest private investment. The aim is to make the Hambantota port a “total logistics solution provider,” the CMPH said in a statement.

Total Logistics Hub

The aim of the government of Sri Lanka and the China Merchant Port Holdings (CMPH) is to transform Hambantota port from a “transshipment hub” to a “total logistics hub” of the Indian Ocean region, the statement said.

For the CMPH, Hambantota is the second investment in Sri Lanka, the first being the Colombo International Container Terminal (CICT). The CICT, which is the first phase of the Colombo South Harbor project, has been in existence for the past five years. The island nation’s only deep water terminal to date, the CICT has already notched 2 million TEUs. The CMPH completed the CICT 32 months ahead of schedule.

Dr. Hu Jianhua, Executive Vice Chairman of CMPH said that the new Joint Venture to run Hambantota port will provide training and employment to Sri Lankans, especially the people of Hambantota district. Already, many local youth have gone for training in other projects run by the CMPH , he said.

Dr. Hu said that the 145 year old CMPH has seven years of experience of working in Sri Lanka and has learnt about the country’s thinking and demands. The success of the Colombo International Container Terminal has given the CMPH “immense confidence” in itself and Sri Lanka, he added.