Financial Times - Port strike off but recovery: long road ahead

Port strike off but recovery: long road ahead

By Chaturi Dissanayake

The nine-day, work-to-rule campaign at the Colombo port, which ended on Friday, crippled key sectors of the economy and cost the government a thumping Rs 35 to 40 million a day but the privately owned South Asian Gateway Terminal (SAGT) saved some of the blushes for the government.

The cost of the protest may be higher if any of the vessels the Port Authority has signed up under Terminal Service Agreements claim damages from the Port Authority but so far (up to Friday) no claim had been made, said R. Wickrama, Vice Chairman of the Ports Authority.

Tea, apparel and other sectors nearly came to a standstill due to the protest by a group of unions over higher wages and if not for SAGT, which accounts for 40 percent of the Colombo Port workload and took in additional work during the crisis, the export industry would have been completely frozen.

Mohan Mendis, Exporters Association President said the total loss to the country cannot be measured financially with the repercussions of this protest seen only in the long term.

“It is difficult to recover from this setback; even if the port is put in order in a short period the loss of credibility and the confidence will have a major negative impact,” he said.

Mendis said with this kind of a negative reputation it would be difficult for the exporters to convince foreign buyers to buy local products, particularly at a time when the country is experiencing tough blows to its economy with rising oil prices.

SAGT operated as usual enabling exporters and importers to ship at least some of their cargo.

“I dread to think what the situation would have been if SAGT was not there,” said Mendis. “By facilitating some of the vessels of the SAGT and increasing the number of exchanges, we tried to reduce the negative impact to some extent,” said Tissa Wickramasighe, SAGT’s Marketing and Commercial Manager.

Unions and the authorities reached a settlement on Friday evening with a committee being appointed to probe allegations of corruption and malpractices.

Back to Business