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Friday, March 03, 2006

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Japan pledges Rs. 19.4 b support

The Finance Ministry said yesterday that the Government of Japan has pledged a sum of Japanese Yen 21,559 million (approximately Rs 19,400 million) to Sri Lanka under its Official Development Assistance (ODA) loan scheme in support of development efforts of the country.

Japanese Ambassador Akio Suda shakes hands with Secretary to the Treasury Dr. P.B. Jayasundera yesterday whilst presenting the pledge for future funding.

In addition to the above, the Government of Japan has already extended its support for the Tsunami reconstruction and rehabilitation activities by providing a loan of Japanese Yen 10,006 million (approximately US$ 98 million) for Sri Lanka Tsunami Affected Area Rehabilitation and Take-off (STAART) Project in June 2005.

This ODA loan scheme is extended on an annual basis and this is the 37th of such loan packages. The loans are offered on concessionary terms and conditions and administered by the Japan Bank for International Cooperation (JBIC).

The loan package consists of three projects. They are; (i) Galle Port Development Project – First Phase, (ii) Pro-Poor Eastern Infrastructure Development Project, and (iii) Tourism Resources Improvement Project.

These 3 projects are in line with the needs identified by the Government of Sri Lanka, aimed at accelerating economic growth and providing essential infrastructure facilities.

Japanese Yen 14,495 mn (approximately Rs. 13,750 mn) is allocated for Phase - I of the Galle Port Development Project. The loan is repayable in 30 years, inclusive of a grace period of 10 years and carries an interest rate of 0.3% per annum. The project is to develop the Port of Galle as a regional port by constructing a new multipurpose terminal to meet the future demand and reallocate break bulk cargo handling from the Colombo Port. It will also help to reduce waiting time of the vessels, berth occupancy ratio and cater to large vessels. Furthermore the project will greatly facilitate the Southern area development plan presently being implemented.

The following activities are expected to be carried out under the project: Construction of a Breakwater; Construction of a Multipurpose Terminal (1 berth); Dredging of the Approach Channel & Turning Basin and Procurement and Installation of Auxiliary Equipment and Navigation Aid required for Modern port facilities.

The second loan of Japanese Yen 4,460 (approximately Rs. 3,950 mn) will be used for the rehabilitation of part of the main highway in the Eastern Province affected due to the tsunami disaster. The loan is repayable in 40 years, inclusive of a grace period of 10 years and carries an interest rate of 0.75% per annum. Under this project, it is expected to reconstruct the road section of 98 km between Akkaraipattu and Trikkandimadu on A 4 and A 15 roads including the construction of a new Kallady Bridge with a length of 291 m, in Batticaloa, in order to improve the access within and outside the Eastern Region. It is also expected to provide training programmes on Operation and Maintenance of Construction Equipment to the local communities by the Institute for Construction Training & Development (ICTAD).

The third loan of Japanese Yen 2,604 mn (approximately Rs. 2,320 mn) is allocated for improvement of Tourism Resources. The loan is repayable in 20 years, inclusive of a grace period of 6 years and carries an interest rate of 0.9% per annum. The Project is to develop human resources and other related infrastructure facilities in tourism sector in the areas of Colombo, Kandy, Negombo, Sigiriya, Anuradhapura and Nuwara Eliya, in order to promote foreign tourists and thereby enhancing employment opportunities and foreign currency earnings. The project also envisages to conduct Marketing and Promotional activities in Japan to promote Sri Lanka as an attractive tourist destination.

The project will be executed by the Ministry of Tourism with the involvement of a number of implementing agencies i.e. Sri Lanka Tourist Board, Central Cultural Fund, Road Development Authority, Provincial Road Development Authority and the Municipal Councils of Anuradapura, Negombo and Nuwara Eliya.

Japanese Ambassador Akio Suda conveyed the official pledge to Finance Ministry Secretary Dr. P B Jayasundera yesterday. Deputy Secretary to the Treasury R A Jayatissa and Counselor of the Embassy of Japan H. Onishi also participated at this occasion.


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