New Sri Lanka shipping policy sees lower dependence on Indian cargo
ECONOMYNEXT – Sri Lanka’s new national policy for its maritime and logistics sectors foresees reduced dependence on Indian container transshipment cargo, Colombo port’s main business for years, given changes in shipping services and emerging competition from other ports.
The final draft of the national policy that aligns the maritime and logistics sectors to reap better economic benefits was presented to Minister of Ports & Shipping and Southern Development Sagala Ratnayaka Thursday, a statement said.
The National Policy for Maritime and Logistics Sectors was drafted by a committee comprising leading experts on maritime affairs chaired by Secretary to the Ministry of Ports & Shipping and Southern Development Parakrama Dissanayake.
Around 80 stakeholders took part in drafting the policy.
“Major Sri Lankan ports need to transform themselves from ‘regional transshipment hubs’ to ‘Global Maritime Hubs’ in order to face the competition from emerging new regional transshipment ports as well as traditional global competitors,” the statement quoted the policy as saying.
“Continued dependence on the Indian subcontinent for a major portion of business will no longer be possible due to emerging regional competition, expansion of direct mainliner service to traditional feeder ports and changes in cabotage laws.
“One needs to recognize the fact that all major global hubs are relay centres for major shipping lines. The share of relay traffic in global hubs far exceeds the share of ‘Hub and Spoke’ transshipment thus making them less vulnerable to emergence of regional competition.”
However, this change will require development of port and logistics facilities well ahead of such demand, the statement said.
“Sri Lanka has hitherto followed a policy of waiting for demand to push before new port/terminal facilities are to be developed,” it said.
This policy allowed other regional hubs to overtake Colombo in the past. It is, therefore, necessary to shift the development policy from “demand-driven” to “supply-driven”, the final draft of National Policy for Maritime and Logistics Sectors has suggested.
One of the aims of the national policy is to “encourage sustainable port development to cater to long-term forecasted growth in volumes of imports and exports and transshipment trades by sea, with a competitive and efficient port industry,” Dissanayke said, quoting the final draft of the national policy.
It aims to meet “the needs of importers and exporters in a cost-effective and timely manner, thus contributing to long-term economic growth and prosperity of Sri Lanka.”
(Colombo/January 31/2019 – SB)