{"id":247685,"date":"2026-06-13T15:37:40","date_gmt":"2026-06-13T10:07:40","guid":{"rendered":"https:\/\/www.colombotelegraph.com\/?p=247685"},"modified":"2026-06-14T07:29:32","modified_gmt":"2026-06-14T01:59:32","slug":"colombo-port-city-rapid-progress-but-where-is-the-foreign-investment","status":"publish","type":"post","link":"https:\/\/www.colombotelegraph.com\/index.php\/colombo-port-city-rapid-progress-but-where-is-the-foreign-investment\/","title":{"rendered":"Colombo Port City: Rapid Progress, But Where Is The Foreign Investment?"},"content":{"rendered":"

By Chanaka Bandarage<\/a> –<\/strong><\/p>\n

\"\"

Chanaka Bandarage<\/p><\/div>\n

When establishing the Colombo Port City<\/a> (hereinafter referred to as the Port City), the main objective was attracting foreign capital to the country. To establish it, the country has paid a high price thus far.<\/p>\n

The environmental damage this project has caused the country is enormous. Thanks to it, sea erosion in southern Sri Lanka has increased tremendously. One only needs to travel from Kalutara to Chilaw along the seaboard to observe the carnage the sea has inflicted upon the land since the Port City reclamation work commenced. Still, large foreign ships continue to dredge sand from the seabed for Port City construction. Inside the Port City, one can see huge sand dunes piled several meters high, which simply get washed away by the rains, prompting even more sand to be mined from the sea.<\/p>\n

The vast granite rocks that intermittently existed between Battaramulla and Meegoda areas are no more; all were crushed and transported to build the Port City. People in these areas have complained of rapidly fluctuating temperatures (both high and low) and declining water levels in their domestic wells.<\/p>\n

Though official reclamation supposedly stopped in 2019, is the Port City continuing to be reclaimed? We ask this because one can see its further expansion toward the Galle Face Hotel end – slowly, yet gradually.<\/p>\n

For the Port City\u2019s infrastructure construction, the Sri Lankan government has spent US1. 4 billion. The present government has made a new lavish allocation of US$250 million for Phase 2 work. These are not small amounts; they are massive. This is money belonging to the people of this country, including the poor.<\/p>\n

The country\u2019s populace is hemorrhaging from a severe economic crisis – one created as a result of corruption and mismanagement by governments, especially those that ruled from 1994 to date. Although authorities do not want to admit it, due to abject poverty, many families can only afford one meal a day. Some go starving for days without citizens around them even knowing. Dansals are run only for Vesak and Poson. Like the West\u2019s soup kitchens, the country needs daily Dansals.<\/p>\n

The Port City is something this country never needed; it was somewhat forced upon us. Governments, including the present one, have poured millions into its sustenance. The present government may not agree, but currently, the Port City is a real burden on the populace. It is like a leaky bucket that can never be filled. The cost of running it is astronomical. To a heavily debt-ridden Sri Lanka, the Port City is the last thing that was needed.<\/p>\n

There is a separate staff at the Port City whose job is globetrotting – these lucky people travel around the world trying to sell it. Basically, they are looking for investors. Have they secured any? The authorities must answer by showing true statistics.<\/p>\n

Some time ago, the Port City administration entrusted an ex-UK Prime Minister – who during his premiership acted as an enemy of Sri Lanka (during the CHOGM, 2013) – to lure new investors. He conducted a seminar type show in Dubai, which is considered a failure. How much was he paid? Furthermore, it now seems the President\u2019s Special Envoy on Foreign Investment, after giving up the Governorship, has joined the globetrotting team? If they are bringing in new investors, that is fine, but to us laymen, that does not seem to be happening. The public demands answers regarding the large-scale use of public money (in this case, US dollars) for seemingly unproductive and useless work.<\/p>\n

What earlier governments boasted was that the Port City would become a regional hub for multinationals in South and Southeast Asia. We anticipated that giant multinationals like Google, Meta, X, Microsoft, Citibank, Samsung, Apple, Starlink, Pepsi, and Coca-Cola would flock here. It is evident that this is not happening.<\/p>\n

Owing to the ongoing Middle Eastern war, Dubai is facing a massive economic slowdown. It is a city built on the hope of creating infinite wealth. Yet today, Dubai\u2019s prestigious apartment occupancy rate has fallen below 15% (prior to the commencement of the war, it was 80%). Dubai now has a high-end event cancellation rate of 70%. British Airways and Virgin Atlantic have cancelled their flights to Dubai. DXB Airport reports that 43% of flights have been cancelled. From March this year to the end of May, there were 37,000 flight cancellations.<\/p>\n

The Port City failed to capitalise on Dubai\u2019s debacle. Though they have a specialised sales team, it is believed they have failed to secure a single departing Dubai bank, legal firm, real estate agent, or financial institution. To the writer\u2019s knowledge, not a single bona fide foreign company has set up an office in the Port City. If this assumption is wrong, the writer is willing to accept it.<\/p>\n

Of course, the Chinese are setting up companies and industrial complexes in their freely given allotments, but that is a different story. Curiously, not even a single Indian company has so far established a running business in the Port City. When the writer asked a friendly, top Indian businessman about this, he stated, \u201cChanaka, we are scared after the Apollo debacle.\u201d He was referring to the DCSL\u2019s take-over of the Apollo Hospital.<\/p>\n

In Sri Lanka, it is normal for established big businesses to swallow up emerging businesses via the stock market. This is wrong and should be stopped. Due to this stock exchange anomaly, prudent foreign businesses are scared to set up public companies here. Not a single government has taken decisive steps to curb the menace of hostile takeovers. It is rumored that insider trading remains rampant in Sri Lanka.<\/p>\n

Of course, some local laws and regulations, like the CSE laws, may not apply to the Port City, but overall, our governments have failed to create a favorable environment for doing business in Sri Lanka.<\/p>\n

To fill the void left by the lack of foreign investors, the Port City Economic Commission has been clever in selling Port City land plots to Sri Lanka\u2019s corporate giants. In fact, locals are setting up businesses there at a rapid pace. For example, Prime\/Melwa and Home Lands have already started their elite real estate projects. For this, they have secured the most sought-after Port City sites. How much did they pay, if anything? It was thought that all Port City transactions would be in US dollars, but these apartments are also being sold in Sri Lankan rupees. All the cafes and restaurants in the Beach Park (which are all rudimentary, single-story structures rather than high-rises) accept Sri Lankan rupees.<\/p>\n

Overall, the Port City is a beautiful place. The Chinese have done a good job setting it up, we do not know how much they have spent. However, one can now observe slightly piled-up garbage (especially plastic bottles) in some areas of the Port City, which are real eyesores. Crows and stray dogs have taken over the land in large numbers, having migrated from the adjoining Galle Face Green, which is often filthy, including its toilets.
\nIt is no wonder foreign companies are not coming.<\/p>\n

We are not suggesting that these innocent creatures must be slaughtered. But, the authorities must take steps to curb their spread.<\/p>\n

While it is anticipated that Sri Lanka\u2019s corporate giants such as Hayleys, John Keells, Cargills, the Araliya Group, LOLC etc will stamp their presence in the Port City, this contradicts its core purpose. Rather than facilitating state and local private banks (e.g., People’s Bank, Commercial Bank, Sampath Bank) to establish branches there, what the Port City Commission ought to have done was attract foreign banks. They have failed to do so. It seems they do not have capable salespersons to undertake this task? When the world-renowned HSBC recently shut its doors and left Sri Lanka, how can one expect other foreign banks to come and establish themselves?<\/p>\n

If the Port City is to be inundated with local companies, it defeats the purpose of its creation. These companies can easily set up branches elsewhere in Colombo. Spending millions in taxpayer money and causing massive environmental destruction are not acceptable trade-offs if external investment is averted.<\/p>\n

The Port City Economic Commission would argue that local companies are paying for their slots in USD, meaning Sri Lanka is still receiving foreign currency. But these are not new dollars for Sri Lanka. Some of these companies perhaps earned them overseas, but they are Sri Lanka-related businesses. Rather than holding them in foreign bank accounts, such money ought to have been remitted to Sri Lanka anyway.<\/p>\n

Why do we need genuine foreign investors in the Port City?<\/p>\n

To build their offices and stores, foreign investors bring in fresh cash reserves. Tech giants (such as Tesla, IBM, or Samsung) share modern technology and superior work ethics and practices. Our local workers can learn from them, acquiring critical new skills that make the entire country’s workforce stronger. Local businesses already operating here cannot provide this on a comparable scale. When we lost the Indian Apollo Hospital, the exodus of Indian experts denied our doctors, nurses, and medical staff the opportunity to learn from them. Lanka Hospitals simply became yet another Sri Lankan hospital, missing out on obtaining the latest state-of-the-art technology.<\/p>\n

With the outside capital they bring in, foreign businesses build better products, giving local buyers more choice and higher quality. Furthermore, foreign companies often have established channels to sell goods all over the world. This would help Sri Lanka, as the host country, sell more of its own products globally.<\/p>\n

Though SJB is not among, our opposition political parties and trade unions have a habit of strenuously opposing every new foreign investment venture. Some social media content creators are also a huge obstruction. Such nonsense does not happen in Dubai, Singapore, Malaysia\u2019s Bayan Lepas, or China\u2019s Shanghai. That is why we miss out on many fields, and it is a major reason why the Port City is struggling to attract foreigners.<\/p>\n

In 2010, the then government ought to have known that Sri Lanka is not Dubai or Singapore, it is very corrupt, disorganised and unsystematic; quality foreign investors are reluctant to come here. Knowing well that this is a chronic 3rd world country, they foolishly embraced the idea, now the country is suffering.<\/p>\n

All developed countries have grown largely through foreign investment. Without it, it is almost impossible for economies to build and expand. But in Sri Lanka, mostly due to political affiliations, the citizenry is clever at criticizing and placing obstacles in front of almost every positive development move made by governments. It is important for the Port City authorities to acknowledge that to build the Port City, they must attract new dollars and fresh ideas\u2014and those come mainly through foreign investment. Anyone can fill the Port City land with local companies, but that is contrary to the purpose for which it was built.<\/p>\n

Finally, the government is issuing visas willy-nilly to all foreign visitors without a charge. The previous administration had a prudent plan (unfortunately laced with corruption) to charge a fee (such as US$50) to every foreign visitor. That was reasonable and healthy for the country\u2019s dollar reserves. This government scrapped that plan and allowed everyone to enter the country free of charge. If tourists are paying thousands of dollars for an air ticket, why cannot they pay US$50 to enter this paradise land?<\/p>\n

There are so many Chinese nationals now in Colombo 1 through 4 that a Sinhalese resident quipped, “In 10 years’ time, they will push us to the number four spot within the Colombo Municipal Council limits.” According to the police, there are numerous Chinese digital racketeers conducting illicit operations in Sri Lanka. In some instances, hundreds of them were caught together. Some Chinese nationals were even caught begging on the roads of Colombo. Were all of them deported? It is doubtful, as Sri Lanka\u2019s immigration enforcement is very slack. Only the Police and the Immigration Department know for sure. It is believed that of the Chinese living in Sri Lanka (who must number in the lakhs now), only a minute fraction actually works in the Port City.<\/p>\n","protected":false},"excerpt":{"rendered":"

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