Sinopec Hambantota refinery moves ahead amid IMF-linked hurdles

The long-discussed project, in the pipeline for nearly a decade, was initially based on a Memorandum of Understanding that promised specific concessions to the Chinese energy giant. However, Rathnayake said those pledges have become difficult to honour under the IMF bailout conditions.

“The IMF has even raised objections to some of our own draft laws designed to facilitate such concessions,” the Minister noted, adding that the situation has complicated not just Sinopec’s investment, but also other major ventures such as the Colombo Port City.

When asked about restrictions on the volume of fuel Sinopec could release to the local market, Rathnayake said the main sticking point remained tax concessions. “When an investor commits to a project of this scale but does not receive the same concessions previously granted to others, it naturally creates dissatisfaction,” he said, stressing the need for discussions to find solutions within the current framework.

The Minister affirmed that the Government is working to balance investor confidence with its IMF obligations, ensuring that foreign investment continues to flow while meeting the program’s requirements.