Sri Lanka’s Hambantota Port industrial zone to receive US$ 300 million Chinese investment
Sri Lanka’s Hambantota Port industrial zone last week signed off on its first ever foreign direct investment (FDI) involving a Chinese investment worth US$ 300 million initially to manufacture radial car and truck/bus tyres for export.
According to reports, the Chinese company is Shandong Haohua Tire Ltd., which is one of the largest private tyre manufacturers in China, with a production capacity of 20 million PCR tires and 5.5 million TBR tires annually.
Its decision to set up manufacturing facility is due to the high quality natural rubber availability in Sri Lanka as well as the strategic location to ship efficiently to the South Asia, Middle East and Africa and early this year, the Company had announced to invest US$ 450 million in Sri Lanka, a news report in the Daily FT stated.
Given the Covid 19 situation, the Board of Investment (BOI) agreements will be signed online via video conferencing with Prime Minister and Finance Minister Mahinda Rajapaksa as a witness.
The Hambantota International Port is managed by Hambantota International Port Group (HIPG) and Hambantota International Port Services (HIPS), two new companies set up under a PPP between China Merchant Port Holdings (CMPort) and the Sri Lanka Ports Authority (SLPA).
According to reports, whilst the Hambantota International port has approximately 3.5 square km of vast land area, dedicated for port-related industries, an additional 50 square km of land just outside the port perimeter is the industrial zone, with ongoing investments by the government of Sri Lanka, in utility infrastructure and highway connectivity to the area.
Sri Lanka’s Hambantota Port is a hotspot for business/investment opportunities given its close proximity to the international maritime route. In fact Sri Lanka’s geographical positioning in the Indian Ocean, ease of doing business environment and the many trade agreements as well as trade concessions enjoyed by the country have made it a business hub in the South Asian region. Sri Lanka’s economic activities have expanded business/investment opportunities in the country’s key economic sectors.
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