Sri Lanka, India and Japan sign MOC to develop East Container Terminal in Colombo Port
The governments of Sri Lanka, India and Japan have signed a Memorandum of Cooperation (MOC) to develop the East Container Terminal in Sri Lanka’s main port, the Colombo harbour.
According to reports, under the MoC among the three governments on the development of the East Container Terminal, the Sri Lanka Ports Authority (SLPA) retains 100% ownership of East Container Terminal (ECT).
The Terminal Operations Company (TOC) conducting all East Container Terminal operations is jointly owned with Sri Lanka retaining a 51% stake, and the joint venture partners purchasing a 49% stake, a statement by Sri Lanka’s Ports and Shipping Ministry stated.
A 40-year loan at an interest rate of 0.1% is expected from Japan to fund the project.
“The envisaged Japanese loan carries one of the best loan terms Sri Lanka has obtained. The 51% stake is also one of the best in SLPA joint ownership endeavours. SLPA’s majority ownership in the new TOC represents a significant step in prioritising national interests,” the statement has noted.
The three governments will work out details based on the MoC at joint working group meetings, and advance their cooperation towards early commencement of work and operation of the ECT, the statement has further noted.
“As a hub of the Indian Ocean, the development of Sri Lanka and openness of its ports are of great importance. Colombo Port is the leading Port in the region. This joint project reflects the longstanding good will and cooperation among the three countries.”
Meanwhile, the local media has reported that Japan has provided cooperation for the development of the Jaya Container Terminal since the 1980’s and around 70% of Colombo Port’s transshipment business is India-related.
Sri Lanka, Japan and India will work together for further development of the Colombo Port and contribute to further regional prosperity and stability of global trading networks, the statement by the Ministry has added.
OSL take:
The government of Sri Lanka is committed to transforming Sri Lanka into a hub in the Indian Ocean. The country’s geographical positioning in the Indian Ocean has given it prominence in the international maritime routes. The latest joint venture between Sri Lanka, India and Japan to develop the East Terminal at the Colombo Port is yet another positive sign indicating the development of Sri Lanka’s ports and shipping sector. The interest shown by India, Japan and China in developing Sri Lanka’s ports and shipping sector is an encouraging sign for foreign businesses to explore business/investment opportunities in Sri Lanka’s maritime sector.
| Article Code : | VBS/AT/31052019/Z_1 |