The health board sued over a delivery procedure which saw him starved of oxygen has agreed to the payout to settle a 17-year legal fight.
It is believed to be one of the largest settlements of its kind in Northern Ireland. The youth, who cannot be named for legal reasons, was left with cerebral palsy after being born at the Ulster Hospital in Dundonald in 1992.
His parents brought a case against the Eastern Health and Social Services Board by claiming medical negligence during his birth. They alleged he was in a distressed state within his mother's womb and should have been delivered sooner.
Delaying the procedure deprived him of oxygen and caused brain injuries, it was contended.
After his parents pursued their claim for years, an action was due to be heard at the High Court in Belfast.
But following negotiations a settlement was reached by consent with the EHSSB's successor, the regional Health and Social Care Board.
As part of the resolution the authority is to pay a lump sum of nearly £1.5m to the 17-year-old.
The board has also agreed to annual payments of £115,000 to meet care costs for the rest of his life.
The family's solicitor, Ernie Telford of Belfast law firm McCartan Turkington Breen, predicted what the eventual scale of damages would be.
He said: “The two figures together are likely to give a total settlement of around £3.5m.
“The boy's mother and father are absolutely delighted with the outcome.
“This is a vindication for their 17-year legal battle.”
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