China Merchants withdraws from $392m Colombo port project — The Hindu

State-owned Chinese company China Merchants Port Holdings has withdrawn from a $392 million joint venture that envisaged the creation of a logistics hub at the Port of Colombo in Sri Lanka. The Hindu reports.

Logistics hub project

The project in question is the South Asia Commercial and Logistics Hub at the Port of Colombo. In 2023, China Merchants Group announced its intention to invest in it, which was expected to increase the group's total investment in Sri Lanka to $2 billion.

More current news is available on the UA.News Telegram channel Telegram.

Under the joint venture agreement, China Merchants was to receive a 70% stake. Another 15% each was planned to be transferred to the Sri Lanka Ports Authority and a private construction company from Sri Lanka.

Investment after the debt default

When China Merchants announced the investment in 2023, it was described as the first major foreign direct investment to enter Sri Lanka after the country defaulted on its external debt in 2022. The default occurred amid a severe economic crisis.