Colombo port woos Myanmar transshipment boxes with 10% discount

Monday, 29 February 2016 00:00 - - {{hitsCtrl.values.hits}}

The Minister of Ports and Shipping Arjuna Ranatunga has expressed his willingness to grant a 10% discount on transshipment handling charges of the ship companies who compliance to carry out Myanmar transshipment operations through the port of Colombo.

The decision was taken following a request made by Sri Lanka Ports Authority (SLPA) and the ship companies.

The decision aims to attract traffic from the fast growing transshipment industry in Eastern India, Bangladesh and Myanmar, to the Colombo port.

However SLPA reports show that the transshipment volumes at East Indian ports and Bangladesh ports have increased during the last two decades. Transshipment volumes have been reported as 67.8% out of overall handling. However the data shows the biggest portion of transshipment volume is still carried out by the port of Singapore.

Data further shows that the transshipment activities of several deepest ports namely Mundra, JNPT, Hazira and Kochin in Western coastal of India are now has divided among several ports.

Hence, it has been recognised that the port of Vizhinijam has high potential to obtain a significant portion from the transshipment handling market of Western India, Pakistan and the Gulf region.

The SLPA warns the move would negatively effect transshipment activities of the Colombo port. Hence, SLPA has taken a policy decision to explore new markets in order tackle the industry. The decision has been taken as the first step towards the effort.

Transshipment volumes in Myanmar have now notably increased. A positive political environment being obtained to the country (Myanmar) has pushed the government to observe new investment opportunities. A feeder service between Colombo port and Yangon port of Myanmar was initiated recently in order to strengthen the effort.

“In 1995, the SLPA granted a 10% discount on transshipment handling charges and aimed to get the attraction of transshipment shipping market of Eastern India and Bangladesh. That was a good decision which was taken by SLPA at that time. However today we extend the facility to Myanmar as well. We believe the decision would increase Colombo port transshipments volumes. In 2014, the Colombo port has handled 2,108 of transshipment containers which belong to Myanmar. However the volume has increased to 14,687 containers in 2015. Hence, we do not have any doubt about the market. Actually, this proposal has come via the administration of SLPA. We have appointed qualified persons to the SLPA top Management. They depend on relevant market trends of the shipping sector when making decisions, rather than on political benefits. That is the reason behind the progress SLPA has achieved during the last year,” the Minister added.

Minister Ranatunga further asserted a new business plan has been initiated further to develop the maritime industry in Sri Lanka.

Among other participants at the discussion were the Acting Chairman of SLPA Prasanna Perera, Managing Director of SLPA H.D.A.S.Premachandra and several other distinguish guests.