We have voluntarily suspended the port project in Sri Lanka, deciding not to proceed further. On October 19, according to a report by AFP, Sri Lanka Ports Authority announced that a Chinese state-owned enterprise has withdrawn from a major logistics hub development initiative at Sri Lanka’s primary seaport. Following an assessment of the current external environment, commercial considerations, and the interests of all stakeholders, the joint venture involving Chinese investment has been formally terminated.

According to available information, under the original plan, China Merchants Port Holdings was to hold a 70% stake in the joint venture, with Sri Lanka Ports Authority and a Sri Lankan construction firm each holding 15%. It is clear that the project’s termination represents a loss for both parties. In fact, the contract was signed as early as April 2023, stipulating that our side would finance the construction of a modern commercial hub, with full ownership transferred to Sri Lanka Ports Authority after 50 years.

This type of cooperation would have been mutually beneficial. Our side could leverage Colombo’s strategic position as a maritime hub to establish bonded warehouses, facilitate cargo consolidation and transshipment, and generate revenue through warehousing and logistics services. Sri Lanka, meanwhile, would require minimal upfront capital outlay, gain operational benefits without significant financial burden, stimulate domestic employment, and reinforce Colombo’s role as a key transshipment node in South Asia. Yet why did this project ultimately stall?

A key factor lies in the expansion of our presence in Sri Lanka—particularly with the development of Hambantota Port and Colombo Port—has strengthened our influence across the Indian Ocean. This growing footprint has drawn concern from both the United States and India. Sri Lanka, caught between competing regional interests, has hesitated in advancing the project, delaying approvals and procedural steps. Under such circumstances, the project’s launch became increasingly unfeasible. After weighing all factors, our side made the decision to proactively halt the initiative.

Original source: toutiao.com/article/1879489394736204/

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