The election of a new president in Sri Lanka could spell the end for Australian operator Crown’s attempts to develop a $US400m casino resort in the capital of Colombo.
Newly elected Maithripala Sirisena has promised to ‘disallow’ licences for casinos put forward by James Packer’s Crown Resorts and local developer John Keells Holdings.
Mr Sirisena switched from the ruling party in November having previously worked under former president Mahinda Rajapaksa as health minister. The previous government had wanted to double the foreign tourist count to 2.5m by 2016. It had wanted to revamp an entire street along Lake Beira for new casinos, creating Sri Lanka’s own mini Vegas Strip. The plan was to offer 10-year tax breaks on income generated from visitors.
Crown has planned to build Crown Sri Lanka, dubbed a must-see landmark resort located on Beira Lake in the Colombo resort district. The 5-star facility would have offer approximately 450 rooms and suites, signature dining experiences and entertainment offerings, conferencing and event spaces, gaming areas, retail outlets and a specially designed water feature attraction.
John Keells Holdings, Sri Lanka’s largest listed conglomerate, was planning to invest $650m into another resort, marking the largest investment by a domestic company in Sri Lanka. The resort, which was due to open in 2018, would have included a 900-room luxury hotel, conference venues, a shopping mall, residential apartments, an office complex and a casino.
Whilst progress had been brisk throughout 2013, the plans stalled following opposition from Buddhist leaders amid concern over the proposed tax breaks for the project.
One analyst said even before the election of the new government: “I don’t think investors thought, and certainly Crown wasn’t selling the idea that this was going to go ahead.”