The cabinet approved a plan under which Sri Lanka will lease 80 percent of the Hambantota port to Hong Kong-based China Merchants Port Holdings Company for 99 years for $1.12bn, a government document showed.
China Merchants Port Holdings Company will make a $5m payment as a security deposit upon signing the agreement, which the government expects to do on Jan. 7.
The company will pay 10 percent of the $1.12bn within one month, and the remaining 90 percent within six months of signing the transaction documents.
Prime Minister Ranil Wickremesinghe had offered during a visit to China in April to swap equity in Sri Lankan infrastructure projects against some of the $8bn in debt the Indian Ocean island owes to China.
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