The project aimed at establishing the landlord status of the SLPA and entrusting the operation to the private sector to improve efficiency. This validation views that this is a right direction and many port projects in the world are taking or try to take the same approach. However, as witnessed by many port projects, it is a challenging approach. To mitigate a risk to the project, the loan covenant stipulated a specific clause that selection of a successful bidder for private concessionaire was a condition of loan effectiveness, but it was amended and breakwater construction was commenced without prior selection of the private concessionaire. The PCR neither evaluated whether the condition was needed nor stated how the project was affected by its waiver. It will yield important lessons if we follow up the result of waiving these risk-taking measures.
Colombo Port Expansion Project