The new facilities of the Colombo International Container Terminals (CICT), the only port in the South Asian region with a deepwater terminal that can accommodate vessels as big as 18,000 teu container ships, is attracting large vessels and higher volumes of trade.
Higher efficiency and faster delivery times of the port with is now making Colombo capable of taking on the transshipment role traditionally performed by ports in Malaysia , Singapore and Dubai. Being much closer to the Indian market than all other mega ports in region. Colombo is fast emerging as the region’s port of choice. Most of Indian’s own ports lack the depth or the infrastructure to handle big vessels, making the Chinese port operator the winner from rising India trade.
CICT gets more than 100 ship calls a month, the South Terminal handled one million teus in the first eight months of the year, after notching up 686,600 teus last year, its first year of operation. According to Tissa Wickramasinghe, General Manager, Commercial and Marketing of CICT, it’s a huge achievement for any terminal anywhere in the world and target is 1.3 millions teus this year and 2.4 million teus in two years, which is the planned capacity of the terminal. After becoming operational in April last year, CICT has helped boost Colombo port’s total annual throughput by 14 per cent to 4.9 million teus. That compares with the port’s compound annual growth rate of 1 per cent in the previous four years. The growth has helped Colombo rise three spots to 30th on the Journal of commerce’s ranking of global container ports. When the terminal hits full capacity, Colombo will zoom into the top 20.
The majority shares of the CICT are owned by Hong Kong-listed China Merchant Holdings International (CMHI). Apart from port interests in the mainland, Hong Kong and Colombo. CMHI has a 49 per cent stake in French port company Terminal Link that operates 14 terminals across the world. Recently it joined a Chinese consortium to take a controlling stake in a port in Turkey, and is now eyeing a port in Lithuania.
The South Terminal, which CMHI built in 28 months rather than the scheduled 60, may in fact be growing too fast for its own good. The government, while acknowledging its stellar performance, has started asking for a bigger bite of its takings.
CMHI’s success gives it a better chance of winning the bid for the planned new ‘East Terminal’. However, CMHI has to reduce its stake in South Terminal as the new government wants to give the state a 51 per cent stake in public private joint ventures.
India, increasingly concerned about a Chinese presence in its relatively less guarded southern region, has also said it wants its companies to “become stakeholders in Colombo port’s expansion” given the large amount of Indian cargo that goes through the port.