Aug 18, 2016 (LBO) – Sri Lanka’s Cabinet has approved shifting four billion rupees allocated for the Hyatt Regency project in Hambantota to the Grand Hyatt project in Colombo, effectively completing the write off of the Hambantota project.
“Although, 315 million rupees has been spent, constructions of the said hotel has not been commenced,” a statement on approved cabinet decisions said.
“Accordingly, the proposal made by Hon. Kabir Hashim, Minister of Public Enterprise Development, to use the funds allocated for Hyatt Regency in completion of the Grand Hyatt Colombo Hotel, was approved by the Cabinet of Ministers.”
The new government cancelled the Hyatt Regency project in Hambantota last year.
A sum of 18.5 billion rupees was invested by Sri Lanka Insurance Corporation, Employees Provident Fund and Litro Gas Lanka Ltd in the equity of Canwill Holdings (Pvt) Ltd for the purpose of construction of Grand Hyatt Colombo Hotel through its fully owned subsidiary Sinolanka Hotels and Spa Pvt Ltd.
The constructions commenced in 2012, with approvals given by the former government. During its construction it was decided to invest 4 billion rupees in building another hotel called Hyatt Regency in Hambantota.
With 315 rupees million already spent, Minister Hashim wants the funds allocated for the Grand Hyatt Colombo Hotel, effectively completing the write off of the Hambantota project.
“It has also been decided to investigate on investing money of public enterprises in commercial ventures which are out of their basic objectives,” the statement added.