Sri Lanka state to pay extra to local contractors

Sri Lanka's Prime Minister Ranil Wickremesinghe arrives with flowers to receive blessings at the Gangaramaya Buddhist Temple, Colombo, Sri Lanka on Wednesday 4 April 2018. On wednesday (4), Wickremesinghe survived a no-confidence motion in the Sri Lankan parliament with a 46 vote majority after a 12-hour debate with 122 MPs voted in his support while 76 MPs voting to remove the prime minister. (Photo by Tharaka Basnayaka/NurPhoto via Getty Images)

Feb 04, 2010 (LBO) – Sri Lanka’s government will allow local contractors to bid 15 percent higher than foreign ones in state projects paid for with money raised from the people domestically, a government minister said. There has been some unhappiness among local contractors at projects funded by China which are built by Chinese contractors and where even part most of the labour is imported.

“Priority preference for local bidders for projects with local funding has been increased to 15 percent,” minister Gamini Lakshman Pieris told reporters.

“Already a 10 percent preference is given.”

Pieris said the cabinet of ministers had decided to increase the price advantage given to local contractors on a proposal by President Mahinda Mahinda Rajapaksa, who is also the finance minister.

The extra payment would be made only for projects financed with money raised domestically.

A government raises money from the people through taxes, borrowings locally, printing (central bank credit) or from abroad.

Many projects financed by multilateral agencies require international competitive bidding to get the lowest price.

But bi-lateral loans from foreign governments sometimes limit them to bidders from