Columns - From the Sidelines

Colombo is up for grabs – question is, by whom?

By Lasanda Kurukulasuriya

With the campaign for the Colombo Municipal Council election gathering momentum, the subject of land acquisitions and sales in Colombo has rather unexpectedly hijacked the debate. The media attention on this issue was probably not in the UPFA’s campaign script.

The government’s Mayoral candidate Milinda Moragoda on almost every television appearance in the past week made assurances that slum dwellers will not be removed from Colombo but will be allowed to remain within the city in alternative accommodation when their homes are demolished. The fact that the demolition of several buildings is on the cards is confirmed by these statements. Moragoda made the remarks flanked by SLFP strongmen like Maithripala Sirisena and Susil Premajayantha, conveying a certain anxiety within government regarding this issue.

Prime beachfront property opposite Galle Face Green sold to Shangrila La leisure group to build a luxury hotel and shopping complexes

The eviction of slum dwellers in “wattas” as they are known in Colombo, is only one aspect of the political dynamite involved here. Opposition UNP MP Ravi Karunanayake has been quick to accuse the government of selling up Colombo to foreign companies (“Suddanta vikunana gamanak yanne”). He was perhaps referring to the sale earlier this year of 10 acres of prime beachfront property opposite Galle Face Green to Shangri La leisure group to build a luxury hotel and shopping complexes. Many other properties have been identified to be acquired for private sector development projects.

Those mentioned in news items include the former Colombo Commercial Company complex (eight acres), Charmers Granary, Transworks Square, a car park and land bordering Chatham Street and Hospital Street in Fort (nine acres), the former Dutch Hospital, a block of land near the former Gamini Hall along D. R. Wijewardena Mawatha (15 hectares), Sri Lanka Exhibition and Convention Centre, Ceynor Restaurant, Air Force Lodges, various properties belonging to the Ports Authority, Railway Department, state banks and Sathosa stores.

Deputy Minister of Economic Development Lakshman Yapa Abeywardena’s announcement on Friday of a government ‘policy decision’ that there would be no more outright land sales to foreigners, comes in the context of this rash of proposed property acquisitions. UNP MPs Ravi Karunanayake and Harsha de Silva have repeatedly drawn attention to this accelerating trend in the sale of high value state lands to foreign investors.

The project proposals for a mind-boggling assortment of luxury hotels, shopping complexes and a variety of leisure and recreational facilities intended to attract tourists will, if implemented, irreversibly alter the character and skyline of Colombo City. Some of the transactions were finalized, by the minister’s own admission, bypassing the usual tender procedures, and were rationalized in parliament on the basis that the land fetched very high prices. The minister’s statement suggesting a reversal in the trend may not appease critics since the government has yet to spell out, in detail, a coherent policy on this subject.

Colombo’s prime real estate may seem pricey by Sri Lankan standards, but it’s probably a steal for the investor who is thinking in dollars. For the Sri Lankan seller the dollar payments convert into substantial money. Hence the apparent scrum to sell to foreigners. Land values in Colombo have been steadily rising over the past decades.

A news report in April said that “Government has decided to amend the laws related to the transfer of land” so that “even a non Sri Lankan would be allowed to acquire government land or what belongs to any state agency, subject to conditions.” The conditions, according to the news story, were that “such land should be more than US$ 50 million and the value related has to be settled in one payment by foreign exchange.” For tourist projects, the report said “the long lease would be for 99 years and the extent of land should not exceed thirty acres.”

A more recent news item last month cited Urban Development Authority officials saying that “Colombo land development projects will be awarded under unsolicited project proposal basis, with necessary cabinet approval.” Presumably this means without following regular tender procedures. With regard to the sale of a part of the Commercial Company property to an Indian company, the same report said the transaction was “shrouded in secrecy after one party was tipped to get it without any procedure due to the backing of a powerful official.”

If state assets are deemed to belong to the public, and if the government is considered to be only their custodian, the question arises as to whether it has the right to trade these assets without a process of consultation. There has been no public discussion or meaningful parliamentary debate on the subject. In any case, it would seem unacceptable that such far reaching changes to the profile of this city are being implemented without any reference to its residents.

MP de Silva, an economist, accused the government of a lack of transparency. He is reported as saying there is no record of the outright sales relating to Shangri La and CATIC in the public financial reports, and the funds received could not be traced in any of the state accounts. He further argued that parliament’s powers over state finance are being undermined as a result of the procedures being adopted by government.

Minister Yapa Abeywardena’s Friday statement does little to clarify the government’s thinking. The transactions involve large sums of money, and the absence of a clearly articulated policy leaves room for the educated voting public of the Colombo Municipal area to ask questions about commissions and kickbacks.

The plight of the slum dwellers seems to have suddenly become a matter of concern to politicians only because the all important CMC election is around the corner. It would certainly be inconvenient at this time to have TV screens flashing images of demolition squads at work, noisy crowds protesting on the streets and police using tear gas and water cannon on them. Public reassurances that these people will not be evicted hardly seem enough to defuse the ticking time bomb that has developed out of the government’s overall opacity relating to the acquisition and sale of high-value state lands in Colombo.

The writer is a senior freelance journalist

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