With the increasing need to recognise the potential of Sri Lanka’s blue economy as a primary driver for future growth, there is a need to strategically develop this sector through focused investment and policy.

In an interview with The Sunday Morning Business, Chamber of Marine Industries Sri Lanka (CMISL) Senior Adviser Gamini Herath highlighted the need to prioritise formulating a comprehensive feasibility study and select the development of the blue economy as the engine of growth for the next century, while addressing these requirements.

Following are excerpts:

How necessary is a comprehensive feasibility study for Sri Lanka’s blue economy and what key components should it cover to ensure measurable outcomes? 

The blue economy refers to the sustainable use of ocean resources, specifically for economic growth, improved livelihoods, and job creation, all while preserving the health of the ocean ecosystem. This preservation is one of the most critical aspects of the blue economy while focusing on other sustainable opportunities. 

Sri Lanka must select the development of the blue economy as the engine of growth for the next century. Looking at the country’s current economic activities, there are few new sectors being discussed, making this a promising and necessary new focus. The Sustainable Development Goals also emphasise this area. 

Sri Lanka’s blue economy is an umbrella term for several economic activities that promote inclusive growth and environmental sustainability. Concentrating on these activities is essential. 

While this is not an exclusive list, key sectors include ocean-based renewable energy, which is an untapped sector; fisheries, which requires moving beyond traditional methods to embrace aquaculture and mariculture for a sustainable harvest, both for consumption and export; maritime transport, which is a major area needing concentration, particularly in ports, port development, port infrastructure, and technology; nautical tourism and recreational boating, which are new areas for developing the tourism sector; and mineral exploration, a sector that is frequently discussed but where little action has been taken. 

Traditional activities are also important, such as ship building, boat building and repairs, and related industrial ventures. Furthermore, there are offshore marine engineering services for vessels and other structures, and related services for the oil exploration industry, such as oil rig layups, maintenance, and crew supply. While some activities in these service sectors have recently increased, a proper strategy is still needed for their full development. 

There is also the sector of ship repair and hull cleaning during voyages for passing vessels, which is currently done on a small scale in Sri Lanka but requires improved technology, and power generation from offshore wind farms and wave energy, which remains largely untouched. 

To fully understand the specific opportunities within all these sectors, a feasibility study is a necessity. A comprehensive study of this nature should focus on several key components: the market, investment requirements, human resources, existing technical capabilities, environmental concerns, regulatory requirements, fiscal measures, financing opportunities, and Government facilitation regarding policy consistency, among other factors. 

The study must conclude with specific recommendations on a priority basis for the private and public sectors, clearly defining their roles and responsibilities, and establishing a roadmap for at least the next 5-10 years. This is a significant undertaking, and the opportunities, as well as the risks, should not be underestimated.  

What are the main capacity-building gaps currently affecting the growth of the blue economy? 

I would say that the main challenge is the lack of a clear policy and roadmap for blue economy development. This is the primary reason for many of the lapses and gaps in the area of capacity building and skill development. 

Without a clear policy, there is insufficient focus on developing skills that align with the strategy and specific needs of the emerging blue economy sector. Therefore, establishing a correct policy and roadmap is the prerequisite for progress. 

When we look at the Technical and Vocational Education and Training (TVET) sector, which is responsible for capacity building, it is still focused on traditional programmes that are inadequate for the blue economy. This new sector demands sophisticated, higher technical competence from its human resources. Currently, the Ocean University and a few private institutions have begun offering a limited, selected set of skill development programmes, but this is not nearly enough. 

For example, in the shipbuilding and repairs sector, there is a clear need for capacity and skill development in many areas such as naval architecture, drafting, shipbuilding technicians, marine electrical and electronic technicians, and much more. On the engineering side, there is a demand for marine engineering technicians and engine room mechanics. 

In navigation, the need is for navigation technicians. The increasing use of drone technology necessitates drone technicians, not just operators. Other roles include deck hands, hull construction technicians, propeller mechanics, paramedics, and ship service inspectors. 

Furthermore, all personnel must be qualified to meet international skill standards such as the Standards of Training, Certification, and Watchkeeping (STCW) and the Continuous Discharge Certificate (CDC) level. 

The lack of appeal among the youth is due to several reasons, including insufficient training facilities in current institutions, the rapid pace of technological change in the blue economy sector, lack of awareness regarding opportunities available, and the lack of proper direction or action despite the sector being discussed for some time. Consequently, little initiative is being taken to start the necessary human resource development through capacity building and skill development. 

Additionally, there is a lack of investment and orientation towards the new technology used in the blue economy within the current institutional structure for operational training and technical education.

To encourage youth and raise awareness of the opportunities, I believe these areas should be offered as electives at least in upper school, so that children can factor these prospects into their future decisions.

Which sectors within the blue economy require the most urgent investment to achieve scalable impact? 

Based on our limited research, there are a few sectors that, with a boost in investment promotion, could take off quickly. 

One important sector is fisheries, specifically aquaculture and mariculture, which offers a significant spread effect. While some small-scale projects are currently being undertaken by the private sector and NGOs, a massive push is needed. 

If aquaculture and mariculture are popularised, a large population in the coastal areas could see an improvement in their livelihoods. This work is continuous and can yield better harvests than traditional methods. 

Currently, Sri Lanka’s traditional fisheries often use multi-day vessels with inadequate cooling systems, resulting in roughly 40-50% of the harvest being unsuitable for human consumption by the time it reaches the shore. Although the fish is not entirely wasted, this destructive manner of fishing severely impacts fish resources. The entire system needs to be changed to focus on aquaculture and mariculture, which prioritise quality and high quantity.

The second sector is nautical tourism and recreational boating. This sector has been gradually improving over the last four or five years, starting with whale watching and expanding to charter vessels for recreational boating, as well as canoeing and similar activities in inland waters for both local and foreign tourists. This is gaining momentum and is creating wealth, jobs, and improved livelihoods in the surrounding areas. 

Nautical tourism is a vast sector encompassing cruise tourism, scuba diving, water sports, sport fishing, yachting, and recreational boating. While the country is moving slowly into this space, significant improvements are still needed, making it a promising sector for immediate investment. 

Next is ship and boat building repairs and related industrial ventures. This has been a focus of several ministries, including the Ministry of Industry, for over a decade. Currently, the Colombo Dockyard is the only shipbuilding entity, along with a few boat-building companies. 

There is a need for second and third ship-building and repair facilities in the country. Focusing on improving this is necessary to meet regional and international demand for various sizes of ships and boats. Another small shipyard in Modara, Colombo 15, which was initiated by Walkers Ltd., was unfortunately closed due to political and legal issues. Reviving similar ventures soon is crucial. 

Offshore marine engineering services is another promising sector that could have an immediate effect on the blue economy if the necessary facilities are provided. These services are mainly provided from Galle and Colombo Port but need to be extended to other commercial ports, particularly in the east, although that particular area is still in the infant stage. Apart from standard port services, offshore marine engineering is a key area of concentration. 

There is a growing demand for oil rig layups, and after operating for a certain period, oil rigs need a resting place for maintenance. The Trincomalee Port is currently providing these layup services, maintenance, and crew supply through a few private sector companies. This sector needs to be strongly encouraged. 

Although it was identified as a thrust sector for export development and saw many proposals from the private sector, the State sector’s control over ports and harbours means that Government intervention is necessary. It must consider the opportunities, provide clear policy directions, and establish a long-term roadmap. 

Ship repair in the deep ocean during a voyage is also a promising sector, even though it requires highly skilled technicians. With an estimated 300 vessels passing close to Sri Lanka daily, many could require such services. 

Mineral exploration should also be approached with extreme caution. It requires a very careful investigation into resource availability and a thorough assessment of whether exploration will disturb the ocean’s ecosystem, which should be considered at a second stage, following an in-depth study.

What next steps should Sri Lanka take to strengthen investment promotion and attract private capital into blue economy projects?

There are a few urgently needed steps. One is implementing reforms in Sri Lanka’s investment promotion strategies providing a long-term, sustainable policy framework for private sector involvement. Blue economy projects are typically high-risk with a longer-than-anticipated gestation period, so the investment promotion approach and the policy framework must be revisited and necessary changes implemented. 

Another critical step is the release of specific, critical locations suitable for private sector investment in the most promising projects. Take the Trincomalee Port, for instance. This location has attracted interest from investors in many countries, and while there has been debate over its utilisation, the time has come to capitalise on its strategic importance.  

What are the main physical or institutional infrastructure constraints affecting the sector’s development, and what changes should be implemented? 

If we are serious about developing the blue economy as the engine of growth we are advocating, we must establish a separate ministry and institutional structure dedicated to its promotion. 

Strategies are ineffective without a proper implementation structure and mechanism to address major constraints faced by project proponents. We have previously advocated for this, but it has not yet been implemented. In addition to the ministry, we recommend creating a blue economy development authority under its purview. 

Piecemeal arrangements will not suffice because we need to focus on the next decade, which belongs to the ocean. Moreover, our export structure is very limited at present.  This is why we need to encourage the development of these huge blue economy sectors, which have greater export potential.

Looking ahead to 2030, what realistic targets can Sri Lanka set for blue economy expansion? 

I personally believe that we should aim for at least $ 6 billion in investment by 2030 in various blue economy projects. This figure is feasible if the proper strategy is implemented seriously. With that level of investment, we could easily top up exports from these prioritised sectors to about $ 12 billion. 

Furthermore, by encouraging the ocean-based renewable energy sector, we could realise foreign exchange savings of approximately $ 2 billion per year, which is currently spent on fossil fuels, particularly for electricity generation. This saving indirectly supports the country’s foreign exchange reserves. In terms of employment generation, over 100,000 direct and indirect jobs can be realised within the five-year period. 

Sri Lanka should seriously present its blue economy development needs to international organisations to secure necessary technical and financial inputs. While we have domestic experts to conduct feasibility studies, we need professionals from multiple areas. The national blue economy strategy should be positioned as the leading growth strategy of the Government. This does not mean neglecting other sectors, but this sector must be given proper focus.