Chinese fertiliser case: Sri Lanka reverses decision

Scurrying to reach a settlement ahead of the High Court order on December 23 the Sri Lankan government is drafting a settlement with the Qingdao Seawin Biotech Fertilizer Company to complete payment and close the deal without accepting the fertiliser in question. This was following a Cabinet decision made this week.

The Attorney General has now advised the government that they should have not gone ahead and stopped payment of 75 per cent of the fertiliser to Qingdao company in the first instance, according to Agriculture Minister Mahindananda Aluthgamage.

The minister when contacted by the Business Times on Wednesday said that the government will make the payment of US$6.5 million as the 75 per cent that they need to cover once opening a Letter of Credit.

This time not only the government but the AG too seems to change his opinion as it was based on AG’s advice that the Ceylon Fertiliser Company had sought court intervention to stop payment of the said amount of money, informed sources said.

Secondly, the government now says that although they are not willing to accept the same fertiliser that has been rejected by the National Plant Quarantine Services (NPQS) they will have to make the payment to save the reputation of the Qingdao company.

In this respect, the Cabinet decision has been taken to ensure that the government does not escalate the situation and settle it “amicably.”

Meanwhile, the Qingdao company has also asked authorities to establish a panel to test the samples sent by their company without relying on one officer to do so. However, it is uncertain whether the authorities will agree to this request.