Port City law likely to be enacted before end of this month: PBJ

• Colombo Port City Economic Commission Bill to be tabled in P’ment in April 3rd week
• Govt. expects no obstacles from SC; AG has already given clearance
• Govt. to advertise internationally for members of Economic Commission 
• Urges local companies to raise funding from foreign sources to take part in project 

By Nishel Fernando 
The government expects the legislation of the Colombo Port City Economic Commission Bill to be completed before end of this month, which will declare Colombo Port City (CPC) as a Special Economic Zone (SEZ), while granting sweeping powers to the proposed commission.

“The bill is scheduled to be placed before Parliament by the third week of this month. After the due process of obtaining the observations of the Supreme Court, the bill will be taken up by Parliament for debate. I hope and expect this legislation will be a reality by the end of this month,” Secretary to President Dr. P.B. Jayasundara revealed yesterday. 

He was delivering the keynote speech of a webinar organised by local think tank Veemansa Initiative, under the theme ‘Asia’s Newest Landscape’. 

As the Attorney General (AG) has already given the legal clearance to the bill, saying it is in accordance with the country’s constitution, Dr. Jayasundara hinted that the bill, which is termed a ‘composite masterpiece’, is unlikely to face any obstacles at the Supreme Court. 

“This legal framework is essentially based on the concept of Greater Colombo Economic Commission that Sri Lanka had in 1977 to set up economic zones and also based on the experience in running some subsequent economic zones in the country. It was also done having due regard to our constitutional framework and also the laws of the land, which need to be recognised in this development model,” he stressed.

Following the enactment of the bill, President Gotabaya Rajapaksa is expected to appoint the seven-member high-powered commission. 

Dr. Jayasundara noted that the members of the proposed commission would be selected through an open application process, which would be advertised internationally.   

“The commission will be independent in conducting their operations. The commission will have a chairman and a board of directors with international reputations and we will be advertising internationally to seek the required personals for this landmark project. I hope this legislation will place Sri Lanka on the global map as the most attractive investment destination in Asia,” he added. 

The proposed commission is expected to facilitate investments to CPC, acting as a one-stop investment centre for investors, while bringing in the much-needed certainty for investors. In addition, it would also take over the promotion of CPC via a consistent and coherent marketing strategy. 

Speaking on the proposed dollarisation of CPC, Dr. Jayasundara outlined that CPC would be a separate international financial centre based on foreign currency transactions, with almost no integration with Colombo, in terms of financial transactions, at the initial stage.  

“CPC will have separate international financial transaction activities. What we are asking is to create much more financial-based international business in CPC. We don’t integrate that with the rest of the country and we have kept overall controls of financials by limiting financial transactions to CPC activities. 

Having such a foreign currency base, I won’t call it dollarisation because it recognises all foreign currency-based transactions,” he elaborated. 

However, he noted that a much greater financial integration could be a welcoming initiative at the latter part of the CPC project. 

Dr. Jayasundara urged Sri Lankans and Sri Lankan firms that are interested in taking part in the multibillion dollar project to look for external sources to raise funds to source their investments. 

According to the bill, all investments into CPC, either from residents or non-residents, have to come from foreign sources, with the permission of the proposed commission.

“Sri Lankans are encouraged to tie up with their foreign participants to raise funds abroad to supplement the CPC development activities. In the current context, we are not ready to create a crowding out of Sri Lanka’s foreign exchange market to develop CPC. We have a number of reputed listed conglomerates that are quite capable of raising money on the strength of their own balance sheets.

It’s intended for everyone to look out, look for international market, do an international marketing, talk to international banks, partner with foreign companies and also target the Sri Lankan diaspora,” he went on to say.
Despite almost no financial integrations with CPC and the rest of Sri Lanka, including Colombo, Dr. Jayasundara pointed out that the government has included elements such as backward integration of CPC development to Sri Lanka’s overall development and provisions to integrate supply chains from various parts of the country, to cater to the requirements of CPC.  

He emphasised that these elements would ensure CPC’s contribution to the development of the country. 
In particular, it was highlighted that Colombo stands to benefit by having such an international financial transaction hub right next to Colombo.