by Kathya de Silva – Senarath
The Colombo Port City Project launched as the biggest investment project yet in the country, now hangs in the balance. Although President Maithripala Sirisena’s visit to China last week gave fresh hope for the continuation of the project due to reports from the Chinese media that it had received the green light, the Sri Lankan government immediately clarified their position that the Port City Project is still under review.
The project has become a burning issue with several factors to consider. On the one hand, it has raised environmental concerns along with legal issues with allegations that proper procedures have not been adopted for such a project. On the other hand, concerns on the diplomatic level have also been raised while investment policies and economic benefits are also considered. Some say that the change in government has resulted in the change in investment and foreign policies citing these as reasons for reservations on the Port City project.
However, it was not only under former President Mahinda Rajapaksa that relations between China and Sri Lanka were at a peak as relations go back to several decades. Sri Lanka was among the first countries to recognize People’s Republic of China in 1950 under Sri Lanka’s first Prime Minister D. S. Senanayake while in 1952 the two sides entered the historic Rubber-Rice Pact under Prime Minister Dudley Senanayake. In 1957, it was under Prime Minister S. W. R. D. Bandaranaike that the two sides formally established diplomatic relations.
Mega development project
Therefore, the Colombo Port City project could be considered as another phase in economic and trade relations between the two countries although as the government reiterated, the problem does not lie with China but with the method through which the project was approved.
The China Communications Construction Company Limited (CCCC), the investor of the Colombo Port City Project, entered the agreement with the Government of Sri Lanka to develop the Port City Project on September 16, 2014.
The foreign direct investment by CCCC for the creation of the Colombo Port City Project is USD 1.4 billion with an estimated 83,000 local jobs to be generated. It is also expected to attract international investments with a total value estimated at USD 13 billion. The complete commercial risk of the project is borne by CHEC Port City Colombo. Companies such as AECOM of USA and ATKINS of the UK are technical partners of the Port City while SWECO of Sweden is the planning consultant for the project, according to the CCCC.
With the suspension of the work in the Port City Project, the CCCC issuing a statement said it is ready to fully cooperate with the government and continue to adhere to the procedures and conditions stipulated in the agreement entered into with the Government of Sri Lanka, including the commitments contained in the approved Environmental Impact Assessment study and addendum thereto. CCCC added that it will continue to comply with the laws of the country and follow the necessary guidelines issued by the government for a mega development project of this nature.
However, Centre for Environmental Justice Chairman Attorney-at-law Ravindranath Dabare said the Port City Project is illegal as it has not followed proper procedures. “As a lawyer I have concerns for the Port City Project. A proper EIA (Environmental Impact Assessment) has not been carried out according to the National Environmental Act,” he said.
“The outright grant or freehold of land allocated to China is illegal. The agreement is void as there is no legal provision for freehold of a proportion of land to another country. According to their agreement, only the President is empowered to lease out the land. The law does not permit any party for freehold of land,” Dabare said.
EIA report
According to the court petition filed by the Centre for Environmental Justice, Dabare said the EIA report compiled for the Port City Project had been created based on a land area of 300 acres.
The Port City was now being built on a land area of 567 acres. The Petition states that in order to reclaim an area around 575 acres, there should be a bed area amounting to 1,000 acres under the sea and this matter has not been addressed or considered in the EIA study.
“In order to fill such an area … they should have identified the sources for at least 120 million cubes of stones which is an issue that has never been addressed in the so-called EIA study,” the Petition states. Although the China Harbour Engineering Company has gained BoI approval, the Petition states, “the BOI or Sri Lanka Ports Authority cannot grant permission for the projects to reclaim the sea.” Dabare citing the Petition said: “Extensive mining in environmentally sensitive areas can cause severe impacts on environmental balance thus causing severe problems such as lands slides endangering the life of humans and other living beings.” Coastal erosion is another fact that has not been adequately looked in to in the so-called EIA study report, according to the Petition. The marine eco system is facing a serious threat, it adds.
The Daily News asked Highways and Investment Promotion Minister Kabir Hashim his views on the legality of the project. “Obviously there had been some mistakes on the side of the previous government. They have not followed a proper internal process. The Ports Authority has no mandate to engage in a mixed development project which involves another country. No proper approvals have been obtained from the relevant line ministries. There have been serious lapses in the country’s normal regulations,” he said.
Sri Lankan Law
However, when inquired from the CCCC about the procedure followed a CCCC spokesperson said: “At the time of commencing preliminary and reclamation work, the Port City had obtained the written consents by the Government of Sri Lanka and through the SLPA, of related agencies such as the Coast Conservation and Coastal Resources Management Department (CC & CRMD), Urban Development Authority (UDA), Geological Survey and Mines Bureau (GSMB), the Sri Lanka Archaeological Department (SLAD) the Marine Environment Protection Agency etc.”
“According to the agreement we entered in the presence of the heads of state for Sri Lanka and China, the SLPA together with the Government of Sri Lanka has the responsibility of obtaining the relevant licenses and approvals for the project,” he said. The CCCC spokesperson added that surveys done for the South Port Project have covered the foot print of the Colombo Port City as well, including the Marine Environment Investigations, Geophysical Investigations, Marine Archaeological Surveys, Ecological and Fisheries Surveys, Water and Sediment Quality Field Surveys, Noise, Vibration and Air Quality Surveys as well as information on potential quarry sites. “In effect, the Port City was designed after assessing the success of the South Port Project via environmental monitoring,” he said.
“CCCC will carry out construction work for Colombo Port City under CHEC Port City Colombo (Private) Limited, a BOI registered limited liability company that is listed under the Companies Act of Sri Lanka, and subject to the laws of Sri Lanka. The Concession Agreement too specifically provides that it is governed by Sri Lankan Law,” he reiterated.
Minister Kabir Hashim said, “if the CCCC says they have followed proper procedures, the committee appointed to inquire into the matter will assess this. Once their report is given after the assessment of the process they followed, a decision can be given on the future of the project,” Hashim said.
The Daily News asked Fr. Sarath Iddamalgoda, Organizing Committee Member of People’s Movement against Port City, the extent of the damage to the environment that he predicts.
Job opportunities
“In the interior of the country, hillocks will be cut down and rocks will be blasted impacting on the lands in the Western province and the water level in those areas will drop and the paddy lands will go dry. When blasting of rocks take place, houses in the interior the walls can be cracked or collapsed. Already there are environmental problems around the quarries in several places such as Kaduwela, Bomiriya, Padukka, Waga, Divulapitiya areas,” Fr. Iddamalgoda said.
He added that a large number of fishermen would also lose their livelihoods as a result of the project. “The fish breeding grounds are already damaged according to the fisherman. There will be erosion of the coastal area,” he said.
“In my view,” Fr. Iddamalgoda said, “job opportunities needed for our country should come from agriculture and fishing. The jobs created through the project will be mostly as room boys in the hotels and girls to work in the massage parlours and so on.”
In this regard, the CCCC seems to be ready to pay compensation for loss of livelihoods. Its spokesperson said, “if the livelihood of a fisherman is affected, the relevant authority from Sri Lanka will review the loss and recommend a suitable compensation scheme, with the agreement of the respective fisherman.”
Those apprehensive of China’s increasing role in the region with such mega projects as the Port City, show concern for Sri Lanka’s sovereignty and territorial integrity. Fr. Iddamalgoda is one such personality who is fearful. “In our case we are against a mini China being created in our land. If done there will be severe geo-political issues detrimental to our sovereignty,” he said.
The CCCC responded: “Not at all. The Government of Sri Lanka will own and act as the sole authority of the Colombo Port City.”
“In most countries in the world, foreign investors are allowed to own or lease lands for development purposes and such schemes do not affect sovereign rights of the State over their territories,” the spokesperson added. The Daily News asked the CCCC, if the Port City Project is stopped, will it be challenged in an international court, to which the spokesperson answered: “Under the agreement between CCCC and the Sri Lanka Government, any dispute between the parties which cannot be amicably settled, will have to be finally resolved through arbitration in Sri Lanka but subject to International Arbitration rules. It is important to note that as the investor, we have protection under the Bilateral Investment Treaty between Sri Lanka and China, which was signed in 1986.”
“Every day the project remains in suspension, we are incurring tremendous losses. We hope the Government of Sri Lanka can review the project soon and lift the temporary suspension to recommence construction work,” he added.
While this tug o’ war between several stakeholders continues, there is also underlined caution to China’s role in the region. Experts say that the Port City issue has bigger implications in the international level, with several other nations eyeing China’s presence in Sri Lanka with suspicion.
Former Ambassador to the UN and political analyst Dr. Dayan Jayatilleka thinks that the Port City Project is not a purely environmental issue.
“I do not think for a single moment that the suspension of the Port City Project is purely or primarily an environmental issue. It is profoundly political and international,” he said.
International forums
“The Port City Project was opened by China’s President himself. So the manner in which some elements of Sri Lanka’s new administration and the overarching National Executive Council have behaved has been profoundly insulting to China. This is no way to treat our country’s best friend!” Dr. Jayatilleka stressed.
He added: “China has been Sri Lanka’s firmest, most faithful friend and most powerful ally throughout the decades. China has unconditionally defended us in all international forums when others have been hypocritically insinuating that we committed crimes in our legitimate and wholly internal war of self-defense. China is a powerful source of economic support for Sri Lanka. China’s new development bank is potentially a great source of strength for Sri Lanka.”
“It is only Rightist, pro-Western elements who shortsightedly feel that we can dispense with or reduce the countervailing role that China plays in defense of Sri Lanka’s national sovereignty and economic development, who can even conceive of taking the stance that they have. No one who has Sri Lanka’s national interest at heart will do so,” Dr. Jayatilleka emphasized.
On a diplomatic level, any expert would acknowledge that antagonizing China would be a very big mistake as China continues to grow in strength, economically and politically in the international platform with strong economies in the world depending heavily on China. Therefore, the government will have to deal with the Port City issue with much care, taking all factors into consideration. In this regard, the Daily News asked Minister Kabir Hashim whether issues regarding the Port City Project would lead to hinder the good relations Sri Lanka maintained with China for decades, to which the minister replied, “Absolutely not.”
“We have excellent relations with China. We collaborate with all other projects with China such as the highway projects etc. We have an excellent rapport with China,” he said.
“I personally don’t agree that this is a diplomatic issue rather than an environmental issue. This is a problem of a commercial nature which needs to be addressed according to rules and regulations,” the minister added.
The Embassy of China in Sri Lanka responding to the same question said, “In the past decades, Chinese business community, with the cooperation of Sri Lankan companies, carried out and completed quite a few mega-projects of infrastructure in Sri Lanka with the support of preferential loans from Chinese banks. We uphold certain principles in strengthening practical cooperation with Sri Lanka, which includes equality and no strings attached, win-win orientation, committing to enhancing the capability for self-development of Sri Lanka and benefiting the general public.”
Practical problems
The Embassy quoting the message from Chinese Ambassador said, “Sometimes, there may be certain technical or practical problems and challenges emerging between China and Sri Lanka in such fields as trade, investment, etc. We hope that both of us will take the two countries’ overall friendly relationship as the first priority, and resolve the relevant problems through friendly bilateral consultation.”
“China has confidence in our bilateral relations, because in the past decades, we always stood by each other, either in good time or in bad time. China is willing to continue a trustworthy and reliable partner of Sri Lanka and its people,” the Embassy added.
It is an accepted fact that a country’s development should be one that is sustainable; one that meets the needs of the present without compromising the ability of future generations to meet their own needs.
It is a moral responsibility of all to avoid exploiting the environment for the sake of development although development is necessary for social progress.
As such conservation of the environment should receive high priority in any development project. However, more than calling for the termination of all development activities, the best way forward is to find a way for development while conserving the environment and maintaining healthy relations with the rest of the world.
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Courtesy:
Smart Patriots Sri Lanka 