Forex crisis: ECT development work hampered
- SLPA short of $ 200 m
- Authorities deny delay
By Maheesha Mudugamuwa
The severe foreign exchange shortage in the country has hampered the ongoing development activities of the East Container Terminal (ECT), with the Sri Lanka Ports Authority (SLPA) struggling to find dollars to pay for new equipment needed for said terminal, The Sunday Morning learns.
As a result of the ongoing forex shortage, purchase of critical equipment for the terminal has been delayed for months, as the authority lacks around $ 200 million in funds to bring down the essential equipment, it is learnt. However, the SLPA denies any delays.
The Sunday Morning learns that only around $ 50 million has been paid out of the total requirement of $ 254 million needed to import the equipment.
According to the JVP-affiliated All Ceylon General Ports Employees’ Union (ACGPEU) Deputy General Secretary G. Niroshan, the construction work of the ECT is currently moving at a very slow pace, with the land refilling ongoing, but the authorities are yet to make the full payments towards the purchasing of equipment.
“The purchasing of equipment was delayed due to the prevailing dollar shortage in the country. Around $ 250 million must be paid but only around $ 50 million has been paid,” he stressed.
He further explained that importing the necessary equipment must be done parallel to the ongoing construction work as it could take time for delivery.
Niroshan noted that mainly the gantry crane transfers and other equipment necessary for the functioning of a terminal should be brought down soon.
The ECT will be the second deep draft container terminal in the South Harbour, with an annual capacity of 2.4 million TEUs and a 1,200-metre quay wall at a depth of 18 metres. Sections that have already been developed are 440 m of the quay wall, the adjacent yard area, and connected facilities at ECT.
According to the SLPA, the construction of phase II of the ECT commenced in January this year and the first 600 m quay is expected to be commissioned in July 2023, followed by the first 900 m quay in January 2024, with the 1,320 m quay to be completed in July 2024.
Accordingly, the SLPA expects to complete all the work related to the ECT by 4 January 2025.
As of now, the Inception Report, Interim Report, Feasibility Study, and Governance Model have already been completed and it is expected that the preliminary design of the Port Communication System (PCS) will be completed this month.
When contacted by The Sunday Morning, SLPA Managing Director Upul Jayatissa said the construction activities were currently ongoing without any impact from the prevailing crisis.
Last year, the then Government headed by President Gotabaya Rajapaksa abruptly cancelled a 2019 Joint Venture project, where India and Japan were to develop the ECT. The agreement had been signed by the Yahapalanaya Government.
The Rajapaksa Government cancelled the project in February 2021, citing strong resistance by trade unions and some politicians, who claimed that the ECT was a strategic asset which should remain in the hands of Sri Lanka due to national security concerns.