The Board of Investment signed an agreement with Colombo International Container Terminals Limited yesterday (22) to develop and operate the Colombo South Container Terminal.

The agreement for one of the largest Foreign Direct Investments will strengthen Colombo's status as a premier shipping hub of South Asia in the 21st century. Construction of the container terminal will commence in December this year.

The project is an investment of US$ 500 million funded by the Hong Kong-based China Merchants Holding (International) Company Limited, Aitken Spence PLC and Sri Lanka Ports Authority with partnership of 55%, 30% and 15% respectively.

The project is expected to provide direct employment opportunities for over 1000 and will be implemented over two phases.

Colombo’s existing terminals currently account for the island’s entire cargo volume. The Government forecasts that rising cargo levels will enable transportation including ports to make up 40% of gross domestic product by 2020. Deeper berths, new terminals and increased efficiency will enable larger ships to dock and transfer cargo more quickly, enabling Colombo to maintain its status as a premier shipping hub.

With the implementation of this project, Sri Lanka will gain economic benefits that include increased container handling capacity, accommodation for the latest generation of large container ships, fast turnaround of vessels, and training of Sri Lankan staff on the latest technology. It will also increase the inflow of foreign exchange to the country from container services.