H’tota port and airport PPPs to fetch over $1b: PM

H’tota port and airport PPPs to fetch over $1b: PM

Saturday, 15 October 2016 00:00

Prime Minister Ranil Wickremesinghe

Says massive foreign reserve boost in the offing after negotiations wind up next month

Asian economic boom once in a life time opportunity for Sri Lanka

Wants A/L students to have option of picking science subjects, in talks with Japan and US for tech universities



By Devin Jayasundera

An upbeat Prime Minister Ranil Wickremesinghe yesterday said Sri Lanka’s foreign reserves would be boosted by over $1 billion when proposed Public-Private-Partnerships (PPPs) for the Hambantota port and airport are wound up next month.

Following Wickremesinghe’s visit to Beijing in April 2016, it was announced that the Sri Lankan Government had proposed debt-equity swaps for the Hambantota mega infrastructure projects. Subsequently it was announced that the Government was in talks with Chinese companies to take over the debt and management of the port and airport that were built on Chinese loans taken by former President Mahinda Rajapaksa.

“Certainly, the port is going to be over a billion (dollars) and the airport will be another hundreds of millions. We have asked for upfront payment,” Wickremesinghe said, addressing the opening session of the Institution of Engineers.

“That is all money coming to our reserves at a time when the global economy is weak” he added. According to the Prime Minister’s office these two transactions are expected to constitute non-debt creating FDI inflows which would increase unencumbered official reserves significantly.

Sri Lanka faced an impending balance of payment crisis last year and early this year but negotiated an Extended Fund Facility (EFF) of $1.5 billion with the International Monetary Fund (IMF) to stabilise the economy. In August 2016 the country’s official reserves increased to $124.7 million to stand at $6.6 billion, up from $6.5 billion at the end of July.

Echoing his recent comments at the World Economic Forum in India, Wickremesinghe pointed out that global economic power is shifting to Asia, emphasising South Asia in particular. He stressed that Sri Lanka should take advantage of the current and future economic conditions and integrate with its neighbours to boost the country’s economy.

“This is a once-in-a-lifetime opportunity for us. If we miss this, we are going to miss it altogether,” said Wickremesinghe.

With technology becoming one of the key areas of a country’s economic development, the limited size of the local talent pool has been a major deterrent in attracting multinational tech companies to set up offices in the Sri Lanka.“One of the constraints that I see for development is the shortage of technological personnel,” said Wickremesinghe. “To promote innovation we are going to need more engineers. Without innovation there’s no point of undertaking all this development,” he added.

According to Wickremesinghe, the current education system does not offer the flexibility for students to mix up their courses between science and non-science streams at the Advanced Level stage. He believes this unnecessarily restricts the opportunity for non science students from commerce and arts streams in enrolling in science subjects “We are in talks with the Ministry of Education. We want to have more science teachers so every student who likes to, can take a science subject. Let’s not stream them into Science, Arts and Commerce,” he said.

Wickremasinghe also lamented the lack of high level technology institutions in the country stating that the focus of universities has always been at the undergraduate education level. He requested professional bodies to propose their plans to the government revitalize the research and development efforts of local institutions. “How do we promote post graduate and post doctoral research in our universities what are the structural changes that need to be done.”

In referring to the only fully fledged technology universities in the country Moratuwa and Peradeniya he said; “If you see the enormity of the problem you will realize that two universities will not be sufficient”. To expand the number of institutions he added that the Government is in discussions with leading Japanese and American institutions to set up branches in the country.