China-backed Amber Adventures pulls out of landmark cable car project, flags possible international legal action
Foreign investment in Sri Lanka:Sri Lanka’s efforts to rebuild foreign investor confidence have suffered another setback with China-based Amber Adventures (Private) Limited officially withdrawing from the Ambuluwawa Cable Car Project, the country’s first-ever cable car venture. The company cited regulatory obstruction, arbitrary state action and policy unpredictability as reasons for its exit.
In a letter sent to the Board of Investment (BOI) on January 13, Amber Adventures said it was forced to abandon the project after repeated interference by state authorities, including the suspension of construction by the Central Environmental Authority (CEA) following complaints circulating on social media—despite the project having secured approvals from all relevant technical agencies.
$3.5 million already invested
The company revealed it had already invested US$ 3.5 million of the US$ 12.75 million total planned investment. The project was financed during the peak of Sri Lanka’s 2022 economic crisis by a consortium of investors from Sri Lanka, China and the United States, at a time when foreign capital inflows were critically needed.
Amber Adventures stressed that the project had obtained clearances from the CEA, Urban Development Authority, Ministry of Defence and the Cabinet of Ministers, and was structured as a Build-Operate-Transfer (BOT) initiative. Under the agreement, the cable car system—valued at more than Rs. 5 billion—was to be handed over to the Sri Lankan government free of charge after 13 years of operation.
‘Commercially unviable’ environment
Rejecting allegations of environmental and landslide risks, the company said the National Building Research Organisation (NBRO) had inspected the site following Cyclone Ditwah and confirmed its structural stability. Despite this, Amber Adventures claimed that continued regulatory harassment and lack of institutional protection rendered the project commercially unviable.
“The absence of any effective oversight or protection by the BOI is a serious regulatory failure,” the company said, adding that it could no longer operate in what it described as a “hostile and unpredictable investment environment.”
The letter also disclosed that the firm is now considering international legal action to recover losses, warning that Sri Lanka’s failure to ensure investment protection sends a damaging signal to global investors.
Growing list of foreign exits
Amber Adventures’ departure adds to a growing list of foreign companies that have exited or suspended operations in Sri Lanka since 2022, citing economic instability, regulatory uncertainty and policy inconsistency.
Notable exits include Japan’s Mitsubishi Corporation, which ended its nearly 60-year presence in the country; French sports retailer Decathlon, which suspended operations in 2022; India-based Zomato, which exited in 2023; and the Adani Group, which withdrew from a controversial wind power project.
Why it matters
At a time when Sri Lanka is attempting to attract foreign direct investment (FDI) to support post-crisis recovery, repeated investor exits underscore concerns over governance, regulatory transparency and policy stability. Analysts warn that unless these structural issues are addressed urgently, Sri Lanka risks further erosion of investor confidence—undermining growth, job creation and long-term economic recovery.