Japan Finnaces Sri Lanka Airport Expansion. Bandaranaike International Airport Sees Congestion Amid a Boom in Air Traffic

04th March 2012, www.island.lk

Sri Lanka’s main international airport has secured financing of 28.9 billion yen financing (330 million US dollars) to expand and modernize facilities as tourist arrivals continue to expand.

The state information office said the cabinet of ministers had given the nod to get a loan of 28,969 million Yen from the Japan International Co-operation Agency.

Amid a boom in air traffic Sri Lanka’s Bandaranaike International Airport has been experiencing some congestion at the so-called daily ‘hub peaks’.

The airport, operated by state-run Airport and Aviation Services Ltd, is to increase check-in counters shortly.

Related Info :

• Sri Lanka BIA Airport to Add another Runway as Traffic Grows

Japan Ups Sri Lanka Auto Market Share with Hybrids. India's Share Down to 45pct. China Third with 5pct

01st March 2012, www.lankabusinessonline.com

Japan has increased its share in Sri Lanka's auto market to 36 percent from 33 percent in value with a surge in hybrid vehicles, amid a boom coming after a cut in taxes, Sri Lanka's main business chamber said.

The Ceylon Chamber of Commerce said in an analysis of the auto market that market leader India's share has in terms of value had fallen to 45 percent to 51 percent. China was third with 5.0 percent.

The value of imports had increased to 219 billion rupees from 117 billion rupees.

The CCC said 57,886 cars and were registered in 2011 up 11 percent while 525,421 vehicles of all types were registered in 2011, up 32 percent from a year earlier including over 250,000 motor cycles.

In 2011, 5,927 hybrid vehicles were imported up from 438. "This growth momentum is likely to continue with the increase in fuel prices," the Ceylon Chamber of Commerce said.

"Japan is the leading supplier of hybrid vehicles into Sri Lanka in almost all categories of vehicles except for cars of cylinder capacity exceeding 2000 cc (cubic centimeters), where Germany is the main supplier."

Transport between 5 to 20 tonnes have risen over 10 fold to 48,384 to 4,359. India supplied 91 percent of the total followed by Japan at 15 percent.

The Chamber said motor cars of less than 1,000 cc engine capacity had grown 222 percent partly helped by Tata Nano cars.

More than 100,000 petrol driven three wheelers have been imported in 2011. Diesel three wheeler lagged are there are only 20,000 in the country. The chamber said 99 percent came from India.

Sri Lanka Investment Forum in Tokyo Attracts Good Response. Facilitates Participation at the Forthcoming Sri Lanka Expo 2012

06th February 2012, www.island.lk

The Embassy of Sri Lanka in Japan organised a business, investment and commercial forum/seminar with a view of encouraging and facilitating Japanese based business persons in participating at the forthcoming ‘Sri Lanka Expo – 2012’ seminar in Colombo.

The seminar, held at the Mission last week, was attended by approximately 50 businesspersons with commercial and economic interests in Sri Lanka. Some of them were potential business persons . Sri Lanka’s Ambassador in Tokyo, Admiral (Rtd.) Wasantha Karannagoda and other senior officials of the Mission addressed the business community and made comprehensive presentations, accentuating the economic, investment and commercial opportunities in the country, the Sri Lankan Embassy in Tokyo said in a statement.

Ambassador Admiral Karannagoda, welcomed and greeted the Japanese business persons. He stated that this was the most propitious time to be engaged with Sri Lanka vis-à-vis commercial and trading activities, investments and other economic activities among others. The Ambassador impressed upon the surge of economic growth, during the last couple of years, in the country. He emphasised that today Sri Lanka has permanent peace, after nearly a three decade civil strife , and is one of the safest places to engage in business venures and invest in the world. Further, the Ambassador delineated the key economic and financial factors of the country, which would be vital for any existing business person to expand the entity or a potential business person to consider committing investments and to be engaged in commercial and trading activities.Karannagoda said that Sri Lanka recorded a GDP growth of 8.1% in the fiscal year of 2011, possesses total reserves sufficient for nine months of imports which is obviously a fundamental indicator of the stability of a given economy, the unprecedented arrival of tourists in 2011 which was close to a million and the strategic location of the country with close proximity to the South Asia, Southeast Asia, East Asia and the Middle East, thus enabling a manufacturing or servicing corporate or entity to market their products from Sri Lanka to almost half of the global population, within a brief length of time, among others.

The Ambassador highlighted the common heritage, religion and traditions of our two countries and the cordial relations the Sri Lanka and Japan have been maintaining for several decades, which would obviously facilitate economic and investment activities, with ease. He added that several corporates and buisnesses from Japan have invested heavily in Sri Lanka, in the past as well in the very recent past, and they have been expanding their entities, thus reflecting the degree of contentment and satisfaction of their investments. Japan is one of the largest Foreign Direct Investors (FDI) in Sri Lanka and we would be happy to witness a marked increase of such investments, commercial and trading activities as well as economic activity with regard to Japan. The Ambassador with his intrinsic knowledge enunciated the inherent and economic utility of the ports of Colombo and Trincomalee as well as the newly built mega port of Hambantota. He added that in the world only nine ports could accommodate the 8thGeneration Container Vessels and two of these nine ports are located in Sri Lanka. This alone is a testimony of the economic and commercial potential of the country as well as a clear and compelling reflection that the country is on an economic trajectory.

Premised on these comments of the Ambassador, he urged the business persons from Japan who attended the seminar to participate at the ‘Sri Lanka Expo-2012’ in Colombo, scheduled to be held from 28th – 30th of March, 2012.

The Deputy Chief of Mission, A.S.U. Mendis, and First Secretary (Commercial), M. Somasena, also addressed the Forum. Mendis stated in his brief address to the Japanese companies and joint ventures which are already in Sri Lanka and invited the potential Japanese investors to capitalie on the business and investment opportunities availabe in Sri Lanka. This, in turn, would lead those companies and foreign investments to expand, thus accruing economic, commercial and social benefits to the landscape of Sri Lanka. He further said that Sri Lanka places priority to increase the FDI, exports and tourism. Mendis added that this was the most opportune time to enter Sri Lanka, in the context of business or commercial entity, since the economy of Sri Lanka is highly stable and poised to record a GDP of 8%-9% in the future years. The First Secretary (Commercial),Somasena, made a comprehensive presentation encompassing the intricate dynamics of the economy, distinct advantages the country possesses, the goods and services which could be imported from Sri Lanka to Japan at a competitive cost and other sectors where investments and economic activity could be focused. Somasena also highlighted that Sri Lanka envisions to evolve as a ‘Hub of Asia’, in spheres such as finance & banking, tourism, services, information & technology, outsourcing and shipping & aviation. He also delineated the benefits of attending the ‘Sri Lanka Expo-2012’ and encouraged the participants at the Business Seminar to take part in it in Colombo in March of 2012.The Business Seminar/Forum was ensued by a session on networking and a dinner reception.

Japan's Marubeni Returns to Sri Lanka for LNG and Power Generation

19th January 2012, www.island.lk

Sri Lanka’s search for FDIs received a major boost yesterday with Japan’s top multinational conglomerate, Marubeni Corporation, announcing its intension of returning to Sri Lanka after leaving these shores in 2008 citing the then weak economic environment. Since then, a lot has changed and top officials of the Japanese diversified group visited the country on a fact-finding mission to recommence operations here, the Ministry of Industry and Commerce said.

"Marubeni wants to re-commence operations in Sri Lanka in due course. The discussions with their fact finding mission today was very successful," Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka said yesterday (Jan. 19).

Marubeni’s fact finding mission was led by Wataru Yoshida, Marubeni’s Tokyo based Corporate Officer and Senior Operating Officer and comprised three other officials including Shinya Watanabe, Chairman and Managing Director of Marubeni India.

Marubeni, which was already active in Sri Lanka for 25 years, closed its operations on May 1, 2008 citing unfavourable economic conditions. Marubeni’s return is also expected to boost Sri Lanka’s FDI inflows further.

Marubeni reported US$ 48 billion revenue in 2010.

Among Marubeni’s major stockholders is JP Morgan Chase Bank.

The diversified multinational conglomerate is engaged in diversified trading activities handling imports and exports of food materials, food products, textiles, materials, pulp and paper, chemicals, energy, metals and mineral resources, transportation machinery, offshore trading.

"We also are present in power projects and infrastructure, plants and industrial machinery, finance, logistics and information industry, and real estate development and construction," said Wataru Yoshida. "We are the largest independent power operator in Japan and energy trader in Japan. We have more than 40 operations across the world including Qatar and even Papua New Guinea. We have projected a net profit of US$ 1.8 billion for 2011 which we want to invest in selected countries, including Sri Lanka. Now, we want to recommence operations in Sri Lanka. In fact, we want to open our Colombo office as soon as possible," Yoshida said.

Shinya Watanabe, Chairman and Managing Director of Marubeni India revealed: "Marubeni India is keen on power projects in Sri Lanka. Marubeni India is now in a position to supply with LNG Gas (Domestic gas) to Sri Lanka if necessary, using our LNG terminals across the Eastern Indian shore. We import around five million tonnes of LNG to India." Shinya Watanabe added: "We are also strong in the Combine Cycle Power Plants (CCPP) sector which we think that Sri Lanka can make good use of. We already have ongoing CCPP projects in Thailand and Indonesia in association with Siemens, among the many project countries." CCPPs use both gas and steam turbines to supply power to the grid and is considered to be an efficient generation mechanism since it uses waste heat to produce steam which in turn generates additional electricity through the steam turbine.

 Image: Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka (left) greets Shinya Watanabe, Chairman and Managing Director of Marubeni India as Marubeni Sri Lanka Mission team leader Wataru Yoshida, Marubeni’s Tokyo based Corporate Officer and Senior Operating Officer (right) looks on.

Japanese Fund Management Company in Sri Lanka to Examine Investment Opportunities to Set up Sri Lanka IPO Fund by June 2011

29th May 2011, www.sundaytimes.lk, By Duruthu Edirimuni Chandrasekera

A Japanese fund management company, VEC Investment (Value Ethics Contraction) visiting Sri Lanka this week to examine investment opportunities said that they are setting their sights on forming an initial public offering (IPO) ‘fund’ dedicated to Sri Lanka in a bid to lure Japanese investors into investing in local equities market in addition to listed firms in the Colombo Stock Exchange (CSE).

“We’ll set up a ‘Sri Lanka IPO fund’ by June and we want to facilitate Japanese firms or investors to come into the Sri Lankan share market through this,” Toshiaki Tanaka, President VEC told the Business Times.

He was part of the Tokyo AIM (TAIM) team which is also gauging the potential in the CSE. The team, whose visit was facilitated by local broker New World Securities (NWS), met up with regulators and top corporates.

Mr. Tanaka also said that his company is keen to draw Japanese investor attention to local private placements (PPs) along with the IPOs. “We are preparing to invest in PPs as well and currently we are in discussion with some corporates with regards to PPs,” he added.

Yuki Uchiyama, Corporate Officer, IT Solution VEC, whose specialty is assisting asset management for Japanese IT firms noted that they will bring in many Japanese IT companies to list in the CSE, which will be facilitated by NWS. “Right now the Japanese market is saturated and we want Japanese IT firms to raise money from emerging markets such as Sri Lanka,” he explained. He said the CSE is attractive and also promising for raising capital and this visit has put a positive spin for such business.

Kazunao Sato, Executive Director VEC revealed that they are targeting to invest in logistics such as cold storage business at the Hambantota Port. He added that temperature-controlled warehouse logistic firms from Japan are interested in setting up a logistics plant for refrigeration, storage, etc. “We are also extremely keen to explore tourism and the telco sectors,” he said, explaining that acquisitions, mergers and joint ventures are being discussed pertaining to such investments. He added that currently a similar partnership is being explored through VEC by a Japanese firm for an investment opportunity in a local travel firm.

Mr. Tanaka added that by early next month a high powered investment team is due in the island as a result of the contacts this delegation made along with NWS during the 3-day visit. “Some top officials in major share broking houses, asset management companies will come in to Sri Lanka in two week’s time to discuss business opportunities,” he said.

Yutaka Ito, COO, TAIM joining in the discussion told the Business Times that Sri Lanka’s GDP rate is ‘fantastic’. “Our main mission is to introduce Tokyo Stock Exchange’s (TSE) equity and bond markets to the Sri Lankan investors. TAIM is a good path to raise money for firms in Sri Lanka,” he explained.

He said that listing in Tokyo AIM helps firms to grow their business through access to a wider layer of funding options and an easier way to bring in fresh capital into firms. Mr. Ito explained that TAIM discussed local firms’ listing in Tokyo AIM. He noted that there’re no minimum requirements for market capitalisation or free float for a company to list on Tokyo AIM.

The listing company structure can be arranged on a case-by-case basis. Mr. Ito added that TAIM wants to facilitate Japanese bond investors here through a fixed income market called T-Pro Bond. He also noted that the CSE is not over valued, but foreign participation is important to expand the CSE.

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Sri Lanka Gets $1.1bn Loans for Roads & Power from China, Japan & India

04th April 2011, www.bloomberg.com

Sri Lanka secured foreign loans valued at $1.1 billion, including from the governments of Japan and India, for projects ranging from road development to electricity transmission, the island’s information department said on its website.

The loans also include $500 million from China Development Bank Corp., $17.6 million from the Asian Development Bank and $38 million from the World Bank, it said.

To contact the reporter on this story: Anusha Ondaatjie in Colombo at anushao@bloomberg.net

To contact the editor responsible for this story: Hari Govind at hgovind@bloomberg.net

China & Capital Markets are Sri Lanka's Top Lenders in 2010

24th November 2010, www.lankabusinessonline.com

China has become Sri Lanka's top bilateral lender up to September 2010, displacing Japan both in commitments and disbursements, with international capital markets dwarfing traditional lenders with a billion dollar bond a month later.

Sri Lanka has racked up 2,481 million US dollars in bi-lateral and multi-lateral financing up to September 2010, the highest ever volume of foreign financing commitments, with China leading the way with 668 million US dollars of export credits.

This year China had displaced Japan, the traditional top lender in both commitments and disbursements, up to September 2010, according to finance ministry data.

Dwarfed

But China's credits were dwarfed by international capital markets this year, with the government raising one billion dollars through a 10-year bond, largely for debt repayment in October.

Japan came in second with a commitment of 424.3 million US dollars including 27.7 million US dollars of grants, the Asian Development Bank came third with 369.7 million US dollars and Russia came in fourth place with a 300 million US dollar credit line.

World Bank had committed 217.8 million US dollars. Iran had committed 111.2 million US dollars in export credits and Australia 105.2 million US dollars.

The finance ministry said this year's financing commitment volume topped the previous high of 2,221.7 million US dollars reported in 2009.

The government was now sitting on an aid pipeline of 6,968 million US dollars which included 1,156.6 million dollars for power and energy and 1,701 million US dollars for roads and transport, 887.3 million US dollars for water supply and sanitation.

Disbursements

Up to end-September a total of 1,460.3 million US dollars of commitments were disbursed.

In actual disbursements also China led the tables with 643.7 million US dollars of which 545 million US dollars were export credits, according to finance ministry data.

The disbursements were swelled with a 445.5 million US dollar trance given to state-run Ceylon Electricity Board to build a second stage of a 900 Megawatt coal power complex. The power plant is a high return, long overdue project.

Japan disbursed 237.1 million US dollars.

The Asian Development Bank had disbursed 187.1 million US dollars including 17.2 million US dollars and the World Bank 120.5 million US Dollars.

Bank of Tokyo Mitsubishi to Open a Branch in Sri Lanka

10th November 2010, www.news360.lk, By Prasanna C. Rodrigo

Central Bank of Sri Lanka says the Bank of Tokyo Mitsubishi is looking at the feasibility of operating a Branch in Sri Lanka.

Central Banks Deputy Governor K.G.D.D. Dheerasinghe said “They might apply for a banking license”.

He revealed this to www.news360.lk right after completing his meeting with the Bank of Tokyo Mitsubishi executives held in Japan today.

Dheerasinghe said “They will be sending a team to do a feasibility study soon”.

Mitsubishi Bank operates over 770 branches in Japan and 76 international branches.

According to Dheerasinghe, The bank is bigger than HSBC.

The Deputy Governor said already several other foreign banks have shown their interest to enter Sri Lanka.

He added “several applications are now being evaluated by the Central Bank”.

100,000 Japanese Tourists to Visit Sri Lanka in 2011 on Visit Sri Lanka Promotion

07th November 2010, www.goldfmnews.lk

Sri Lanka is to expect 100,000 tourists to fly in from Japan in 2011 due to renewed interest in the country and the 'Visit Sri Lanka 2011' campaign.

Japan, a strong and longstanding development partner of Sri Lanka is keen on developing the ties between the two countries and is encouraged by the stable political conditions to persuade more Japanese to come to Sri Lanka.

In the January-September 2010 period, tourist arrivals were up 44 percent compared with the same period last year.

Related Info:

Sri Lanka Tourist Arrivals

Japanese Invest in Sri Lankan Education Sector

18th October 2010, www.island.lk

During a period when quality, cost effective and specialized education takes prominence in today’s competitive and commercial world, a Japanese Education Group has collaborated with the OpenArc Educational Institute – Sri Lanka, to form OpenArc College of Business and Technology (OCBT) - a BOI approved company, in order to provide competent educational services to the local market.

Teruaki Ono – Chairman of OCBT, shared his views on why Japanese Education Specialists chose Sri Lanka, the future outlook of education in the local market through OCBT and the reasons for collaborating with the OpenArc Educational Institute.

Sri Lanka is a country that boasts of a literacy rate of over 90% and overall, comprises of a very literate market. Teruaki Ono explained, that the close ties Sri Lanka has shared with Japan over the years has enabled them to gain valuable insight to various aspects of the local education market, which has allowed them to form a clear vision for proficiently educating local students. Ono stated that, as a whole OCBT foresee great scope for the provision of specialized educational services to the local education market.

Mentioning briefly about their Japanese education group, Ono said, " We are a longstanding educational group operating in Japan, South Korea, Malaysia, Taiwan, China and of course in Sri Lanka; through Open Arc Educational Institute, as Open Arc College of Business and Technology (OCBT). We selected Sri Lanka as a country with great scope for educational services and thus invested Rs. 50 million into further enhancing the facilities and infrastructure of Open Arc College of Business and Technology (OCBT) to facilitate advanced courses of study".

The Chairman further explained that within the next few years, they plan to invest another Rs. 50 million to conduct high tech courses of study in Sri Lanka through OCBT.

"We aim to provide a larger group of students with the opportunity for internships and job placements during, as well as after their study programmes at OCBT. We have plans to unveil high tech courses such as Robotics, while continuing software development for the benefit of students in the Sri Lankan market to become theoretically & practically proficient professionals, with the scope to work anywhere in the world," said Ono enthusiastically.

Japan to Consider Free Trade Agreement with Sri Lanka

30th July 2010, www.lankabusinessonline.com

Japan is willing to consider a request by Sri Lanka for a free trade deal between the two countries, a foreign affairs ministry statement said.

"The government of Japan will be prepared to engage in the necessary consultations with regard to a Free Trade Agreement between Sri Lanka and Japan," it quoted Masayuki Naoshima, Japan’s Minister of Economy, Trade and Industry as saying in Tokyo.

Naoshima was responding to a request by visiting Sri Lankan external affairs minister Gamini Peiris and Basil Rajapaksa, minister of economic development.

They visiting ministers asked Japan to consider entering into a Free Trade Agreement with Sri Lanka given the "vast opportunities" now available in Sri Lanka for investment and trade, the statement said.

Sri Lanka's 30-year ethnic war ended in May 2009, resulting in an immediate economic revival with economic growth forecast at seven per cent this year.

Japan has also been one of Sri Lanka's biggest donors and lenders, helping to fund infrastructure like ports and highways.

More Japanese Tourists to Visit Sri Lanka on Eco-Tourism, Religious and Other Specialized Areas

28th July 2010, lankapuvath.lk

Prof. G.L.Peiris, Minister of External Affairs and Mr.Basil Rajapaksa, Minister of Economic Development who are currently on a visit to Japan met with Mr.Akira Kanai, Chairman of the Japan Association of Travel Agents (JATA) on Tuesday (27).

At the meeting, the Sri Lankan Ministers informed that the Sri Lanka Tourism Authority is now concentrating on new areas of interest for tourists visiting Sri Lanka, which are mainly, eco-tourism, religious tourism and certain specialized areas such as ayurveda.

The Ministers also emphasized that since the UK and US travel advisories on Sri Lanka have now been relaxed, they wish to invite a team of JATA officials to visit Sri Lanka and experience first-hand the present situation. They also requested the visiting team to give any advice on areas that require improvement in the tourism sector.

Mr. Kanai was of the view that the Japanese public need more awareness on Sri Lanka as a travel destination, and that Japanese visitors are very concerned about Japanese food and Japanese language when visiting a destination and these are the areas that need attention when attracting Japanese tourists to Sri Lanka.

The Ministers also met with Mr.Hajime Ishii, Member of the House of Councillors and Vice President of the Democratic Party of Japan (DPJ) at the party headquarters along with other parliamentarians. The Sri Lankan Ministers exchanged views on Japan-Sri Lanka relations and common political achievements. They also agreed to continue the strong bilateral relations between the two countries both at state and political party level.

The Ministers also met with Ambassador Yasushi Akashi, Special Representative of the Government of Japan on Peace Building, Rehabilitation and Reconstruction. The Ministers briefed Mr.Akashi on the current developments in Sri Lanka.

Noritake Tableware to Expand Sri Lanka Operations

16th July 2010, www.news360.lk

One of the world’s largest general tableware manufacturers Noritake is planning to expand its Sri Lankan operations.

The BOI said, the visit by Noritake’s global head Hitoshi Tanemura was aimed at discussing matters pertaining to the company’s expansion work in Sri Lanka.

Tanemura during his stay also made a visit to meet President Mahinda Rajapaksa yesterday.

Noritake Lanka porcelain is Noritake’s Sri Lanka arm.

Image: Noritake Global Head meets Sri Lanka President Mahinda Rajapaksa

Japanese Entrepreneurs to Invest in Projects in Sri Lanka. Nippon Foundation President Yohei Sasakawa Visits Sri Lanka

08th May 2010, www.dailynews.lk

The Japanese Government and the Business Community will provide their unstinted support and co-operation towards the efforts of the Sri Lanka Government to build a strong economy after ending the war, said Nippon Foundation President Yohei Sasakawa when he met President Mahinda Rajapaksa at Temple Trees yesterday.

Sasakawa said he hoped to induce and divert large scale Japanese entrepreneurs towards investment projects in Sri Lanka so that the country could generate more employment opportunities for its people.

A press release by the President’s Media Division said during the talks Sasakawa also invited President Rajapaksa to visit Japan at a convenient date in the future.

Sasakawa who earlier functioned as a Special Commissioner of the WHO underdeveloped countries in Africa, Latin America and Asia joined the Nippon Foundation in 1981.

Ven Gallehepitiye Pemarathana Nayaka Thera, Secretary to the President Lalith Weeratunga, and Seva Lanka Foundation President Harsha Kumara Gunaratne were also present on the occasion.

Sri Lanka 400kw Solar Project with Japanese Government

20th January 2010, www.thebottomline.lk

The Minister of Power and Energy John Seneviratne, is to sign the Memorandum of Understanding with the Japanese government for the construction of a 400 kW grid connected solar power generation plant at Buruthankanda, Hambantota, under a grant from Japan.

The Government of Japan has provided a grant of Japanese Yen 860 million (approximately Rs. 1,075 mn) to the project which will be implemented by the Sri Lanka Sustainable Energy Authority.

To address the issues on climate change and to access the clean energy, the government hopes to reduce dependence on fossil fuels for electricity generation in Sri Lanka. Development of renewable energy sources is now at a very important stage, with only hydropower being the only significant renewable energy sources for the electricity generation.

A massive 55 to 60 percent of the power supply was generated by diesel, while the share of hydroelectricity averaged between 40 and 45.

Electricity costs in Sri Lanka are among the highest in the world with all users paying high cost for industrial, commercial and domestic uses and driving away the investors. Average electricity tariff rates to industrial sector is from Rs 7.00 to 7.50 in Sri lanka; Indonesia 1.52 – 3.90; Malaysia 2.63 – 10.52; Singapore 4.32 – 6.78; Thailand 2.89 – 7.01, according to the Central Bank’s Annual Report of 2004.

The installed capacity in the country was 2,544 MW (Hydro and thermal combined) in 2006.

Demand for electricity in Sri Lanka is said to increase by about 10 percent annually.
Presently the daily electricity requirement of the country stood at 1.9 GW out of which one third was contributed by hydropower projects and the rest by thermal power plants.

400kW Solar Plant in Hambantota with Japanese Aid, Helps Demonstrate the Sustainability of Commercial Scale Solar Power Generation

03rd December 2009, www.lankabusinessonline.com

The Japanese government will give Sri Lanka a grant of 860 million yen or just over a billion rupees to build a 400 kiloWatt solar power plant in the southern Hambantota district which will be connected to the national grid.

Investment Promotion Minister Anura Yapa told a news conference the island's Cabinet had approved the project aimed at introducing clean energy.

The plant will help to demonstrate to developers, lending agencies and equity investors the sustainability of commercial scale solar power generation, a government statement said.

"Development of renewable energy sources using solar power is vital due to the fact that only hydro power sources are used as renewable energy sources at present," it said.

The solar project will be implemented by the Sri Lanka Sustainable Energy Authority under the Ministry of Power and Energy.