Sri Lankan government assigns US$ 90 million to enhance capacity of Colombo International Container Terminal
Sri Lanka’s Cabinet of Ministers has approved a US$ 90 million proposal tabled by the country’s Prime Minister Mahinda Rajapaksa to enhance the capacity of the Colombo International Container Terminal (CICT).
Prime Minister Rajapaksa has presented the proposal in his capacity as Finance Minister.
“These funds will be used for the renovation of the existing equipment as well as for the implementation of productivity boosting work of that terminal and for publishing the orders for the provision of applicable tax relief as per the provisions of the Strategic Development Project Act in the Government gazette,” Cabinet Co-Spokesperson, Minister Dr. Ramesh Pathirana has told the media.
Considering the prevailing demand for the activities of that terminal as well as the future prospective business opportunities, it has been decided to extend the said project without performing further construction, but enhancing the capacity of its container yard, the Minister has been quoted as saying in the Daily FT.
CICT is a joint venture company between China Merchants Port Holdings Company Limited (CMPH) and the Sri Lanka Ports Authority (SLPA) under a 35-year Build Operate and Transfer (BOT) Agreement with SLPA, Colombo’s third container terminal with a three million TEUs capacity. It was constructed in the Port of Colombo under the Colombo South Harbour expansion project. CMPH holds 85% of the partnership, whilst the balance 15% is being held by SLPA.
In January, CICT had announced it handled a total of 2.9 million TEUs in 2019, achieving an 8.6% increase in its throughput and accounting for 40% of the volume of the Port of Colombo in 2019.
OSL take:
Sri Lankan authorities are focused on further developing the country’s maritime sector. Sri Lanka’s geographical positioning in the Indian Ocean, ease of doing business environment and the many trade agreements as well as trade concessions enjoyed by the country have made it a business hub in the South Asian region. China has placed Sri Lanka in a prominent position in its Belt and Road Initiative (BRI). Foreign businesses/investors could therefore confidently explore business/investment opportunities in Sri Lanka’s ports, shipping and maritime sectors.
| Article Code : | VBS/AT/03112020/Z_3 |