High altitude training centre put on hold
The government has put the multi-billion rupee high altitude training centre at the Nuwara Eliya Racecourse on hold over the financial viability of the project.
A source from the PM’s office said that, while a high altitude training centre can be useful, the government is finding it difficult to accommodate the loans so priority has to be given to social infrastructure.
The project which includes indoor and outdoor training facilities at an altitude of 1868m (5708 feet estimated to cost a staggering €75.5 million or approximately Rs 12.9 billion). The money is expected to be sourced by the contractor.
There have been questions regarding the economic feasibility of the project, spending a huge sum for a ‘fancy’ training centre and how would the administration generate returns on the heavy investment.
The project needs Cabinet approval before signing the financial agreement by the two governments.
“At US$ 88mn, the loan is very high,” a source from the Prime Minister’s office said. “And it is felt that a high altitude training centre could be implemented as a public-private partnership in a manner that generates income to the government, rather than going for a loan at a time when money can’t even be found for the Central Expressway”.
This was quite different to the sentiments expressed by the government previously. After signing the technical agreement with the French Company–Ellipse Project SAS in July last year, former Sports Minister Dayasiri Jayasekera said that the project is not a business venture but an investment to improve the general standard of sports and hence they would pursue with the project.
Once constructed, the training facility will have an indoor sports complex, indoor swimming pool, multi-sport ground, cricket ground, 400-metre synthetic running tracks, 400-metre grass track, two indoor tennis courts, administration block and medical centre, apartment block and a hotel with 75 room facility.
The Cabinet last year approved the transfer of an Urban Development Authority (UDA) land (1 acre, 1 rood and 23.69 perches) to the Ministry of Sports the construction of the hotel. (1 acre, 1 rood and 23.69 perches).
Rejected by the Treasury’s Cabinet Review Committee (CRSC) on two previous instances–in 2009 and 2013–the project was pursued for the third time by the SLFP-UNP collective government. The Cabinet approval was granted in December 2016 subject to the Ministry of Sports obtaining all approvals from relevant authorities.
According to Cabinet Memorandum MNPEA/2017/068 submitted by Minister of National Policies and Economic Affairs, Ellipse Projects SAS was selected by the Ministry of Sports to implement the project under financial assistance from UKEF’s (United Kingdom Export Finance) and Hatton National Bank of Sri Lanka. The Cabinet paper also says UKEF is to finance up to 70 per cent of the project price while the balance 30 per cent is to be sourced through a local bank.
“Negotiations have been concluded to with the UKEF to obtain a buyer’s credit facility of up to Euro 51,576,006.15 to cover approximately 70 per cent of the contract price of the project and with Hatton National Bank of Sri Lanka (HNB) to obtain a credit facility of up to Sri Lankan rupees equivalent of Euro 23,952,694.76 to cover the remaining balance of the contract value,” the Memo says. The funders have offered a 13-year repayment period including a three-year grace period.
(By Champika Fernando/Sunday Times )
