November 17, 2019
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    Lotus Tower mired in financial controversy

    September 17, 2019

    The Lotus Tower, expected to become a Colombo landmark, is entangled in a web of cost overruns and unexplained financial transactions with the Government committed to repaying a huge debt for the project, according to the information sources. Although the Sri Lankan government had paid an initial deposit of Rs. 2 billion to a Chinese company, there is no record of what happened to that money to date, Government sources told Daily News yesterday. President Maithripala Sirisena himself alluded to this controversy when he ceremonially commissioned the Lotus Tower yesterday.

    These sources pointed out that the Lotus Tower was finally completed and vested with the people this week with the government having saved a huge amount of money for the country which would have been lost due to a controversial project agreement. The original estimated cost of the Lotus Tower was Rs. 19 billion and the Chinese Exim Bank had agreed to grant this sum to Sri Lanka. The contract for the construction of the tower was signed on January 03rd 2012 with China National Electronics Import and Export Corporation (CEIEC) being the general contractor, and with the Chinese company and the Telecommunications Regulatory Commission.

    However, investigations carried out in 2015 when the new government came to power, revealed that there was no information regarding this Chinese company which was a party that signed the agreement. Government officials said that this was notified to the Chinese Government by Sri Lanka. However, even the Chinese Government could not come up with any information regarding this Chinese company either within or outside of China. Even the address that was given in the agreement with regard to this company appears to be a fake address, officials said.

    The initial deposit of Rs. 2 billion paid to this company by the Sri Lanka Government is also unaccounted for and no one knows what happened to it. Thereafter in November 2017 this company was removed from the tri party agreement and as a result the Chinese EXIM Bank had suspended the loan facility due to be given to Sri Lanka. Thereafter, the Rs. 16 billion that was scheduled to be granted to Sri nLanka by EXIM Bank was limited to Rs. 12 billion. Howewver, by then Sri Lanka was already paying the Rs. 2400 million loan repayment annually. Sri Lanka had paid the loan installment of Rs. 2400 million for 2018 and Sri Lanka needs to keep paying this sum annually for the next 10 years. The payment for the first half of 2019 amounting to Rs. 1200 million has already been paid.

    It was in such a situation that the TRC invested Rs. 4 billion to the Lotus Tower project saving the country a huge amount.The base circumference is 45 meters and it stands at a height of 356 meters. The main feature of this tower is the transmission tower and the antenna coverage length is around 90 meters.The digital antenna covers a distance of 60 km to the north, 60 km to the South and 50 km to the East and 15 km to the West. This will provide transmission facilities to 20 television stations and 50 FM channels.The initial design for the Lotus Tower was done in 2008, while construction commenced in 2012. The Moratuwa University provided the main consultancy services with the expertise from around 70 engineers. The Lotus Tower provided an ideal platform for many engineering students to gain experience.

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