Sri Lankan East Terminal to commence commercial operations in three months

The Government of Sri Lanka will make the Colombo Port East Terminal operational within three months, a senior official said. "The business community can have hope within the next three months," said Daya Ratnayake, Chairman of the Sri Lanka Ports Authority.

In his election manifesto, placing out his plans for the years 2020-2025 president Gotabaya Rajapaksa made the East Container Terminal development a priority. The regime has said it plans to double the capacity at Colombo Port for container handling.

"We can develop the Western Terminal which we are going to focus on next," Ratnayake said. Policy paper 2020-2025 said Sri Lanka would attract private investment into a planned West container terminal and study the feasibility of a cross-berth terminal between two existing terminals. "Later, we'll explore the ports cruise business," Ratnayake said. "For Sri Lanka, this is a gold mine that has not exploited to its full capacity," he added.

Construction of the terminal with private investors ditched under the last administration, despite the top global shipping lines expressing interest. "Other constructions stopped after the Eastern Terminal completed, and as a result, we lost huge revenue that no one had estimated," Ratnayake said.

With all the inconveniences, the chairman said the ports last year generated 51 billion rupees in revenue. "Because of discrepancy, guidelines or a proper plan, we're not being competitive or achieving our potential," he said.

Colombo International Container Terminals (CICT), a Chinese-controlled terminal, said its volumes had risen 322 percent in the last five years, from 686,639 TEUs handled in its first year in 2014. CICT treated 2.9 million containers at the Port of Colombo in Sri Lanka in 2019.

OSL Take: The newly elected government aims to develop Colombo-Katunayake and Hambantota Mattala air and seaports as commercial and passenger ports. They will also convert these locations into free ports to encourage local entrepreneurs and overseas channel investments into these areas. Foreign investors could explore investment opportunities in the following areas:

The government of Sri Lanka focused on making the country a maritime hub in the Indian Ocean region. The latest achievements of the Colombo and Hambantota Ports indicates that the country is closing in on achieving the target. The port already has an industrial zone on the premises, which provides an ideal business space for companies engaged in exports and logistics.

All these developments would help Sri Lanka engage in trade activities with other countries. On the other hand, Sri Lanka could attract more cruise liners to the state by developing other harbors around the country and developing the required infrastructure facilities. Foreign businesses/investors should explore the increasing investment opportunities in Sri Lanka's ports and shipping sector.

VBS/AT/20200311/Z_TB4