March 14, 2008 (LBO) – The Asian Development Bank and Sri Lanka are holding talks to modify an agreement to avoid further delays in starting work on a bank-funded breakwater for a new port, a senior ADB official said. “The breakwater contract is time critical in that if it is not awarded soon the project would lose one full construction season and this would delay completion of the project,” said Richard Vokes, ADB country director for Sri Lanka.
“This would impose significant costs both on the project itself and to the wider economy,” he told LBO.
“Hence, there have been discussions between the government of Sri Lanka and ADB to see if there is anyway we can enable the breakwater contract to go ahead while leaving the overall project concept intact.”
The ADB has pledged a loan of 300 million dollars for the breakwater and dredging but disbursement was conditional on the government awarding the container terminal deal in a fair and transparent manner.
The government has now asked the ADB to de-link the two projects to enable work on the breakwater, or harbour wall, to start.
Work on the container terminal, for which bids have now been cancelled, can only start after completion of the breakwate