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Monday June 3rd, 2024

Sri Lanka sees steep shipping cost rises amid Red Sea troubles

ECONOMYNEXT – Sri Lanka’s exporters are seeing steep increases in freight rates on West-bound rates which industry analysts warn will spread to the East as ships and containers are delayed while passing around Africa to avoid Houthi attacks in the Red Sea.

The sailing time to exports to the EU and to the USA East Coast have increased by around 12 to 14 days,” Yohan Lawrence, Director General of Sri Lanka’s Joint Apparel Association Forum told EconomyNext as ship by-pass the Suez canal.

Rates to some European ports have increased by as much as 2000 to 3,000 US dollars per 20-foot container, he said, which has resulted in doubling of freight costs in some cases.

Import containers from East Asia had not gone up as much, so far.

From Shanghai, a 40-foot container has gone up to around 1500 to 1,600 US dollars from around 900 to 1,000, says Viraj Perera, Managing Director of Reliance Agro Pvt Ltd, a company dealing in agricultural machinery.

“Container availability has also got tighter,” he said.

Freight rates are still lower from the peaks seen when the US Fed was firing a global inflation bubble.  

At the peak rates were around 8000 – 10,000 US dollar per 40-foot container.

As ships are strung along around Africa, it will take longer for them to turn around and return to East Asia reducing ship calls and also containers, which will remain at sea for longer.

“Going around Africa has increased the time to three weeks, when the return journey is counted,” Rohan Masakorala, Chief Executive of Colombo-based Shippers’ Academy said.

“Both the supply of containers and availability of ships will reduce, affecting Eastern routes as well.”

An apparel exporter who was trying to complete deliveries for the summer season, where deadlines are just ending, said they were combining shipments in January as ship calls reduce to Colombo and try to meet deadlines.

“If we don’t meet the deadlines we will have to airfreight shipments,” he explained. “So far I have managed.”

Sri Lanka’s Colombo Port has seen higher transshipment volumes as ships going around the Cape of Good Hope unload containers destined to Middle Eastern ports. (Colombo/Jan16/2023)

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Water levels rising in Sri Lanka Kalu, Nilwala river basins: Irrigation Department

Sri Lanka Navy assisting in rescue operations (Pic courtesy SL Navy)

ECONOMYNEXT – Sri Lanka’s Irrigation Department has issued warnings that water levels in the Kalu and Nilwala river basins are rising and major flooding is possible due to the continuous rain. People living in close proximity are advised to take precautions.

“There is a high possibility of slowly increasing prevailing flood lowline areas of Kiriella, Millaniya, Ingiriya, Horana, Dodangoda, Bulathsinhala, Palinda Nuwara and Madurawala D/S divisions of Ratnapura and Kalutara Districts, up to next 48 hours,” it said issuing a warning.

“In addition, flood situation prevailing at upstream lowline areas of Ratnapura district will further be prevailing with a slight decrease.

“The residents and vehicle drivers running through those area are requested to pay high attention in this regard.

“Disaster Management Authorities are requested to take adequate precautions in this regard.”

The island is in the midst of south western monsoon.

DMC reported that 11,864 people belonging to 3,727 families have been affected due to the weather in Rathnapura, Kegalle, Kilinochchi, Jaffna, Mullaitivu, Kalutara, Gampaha, Colombo, Galle, Matara, Hambantota, Puttalam, Kurunegala, Kandy, Nuwara Eliya, Anuradhapura, Polonnaruwa, Badulla, Moneragala, and Trincomalee districts.

Meanwhile, the Meteorology Department stated that showers are expected on most parts of the island today.(Colombo/June3/2024)

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UNP gen secy defends call for postponing Sri Lanka poll, claims opposition silent

The UNP party headquarters in Pitakotte/EconomyNext

ECONOMYNEXT — United National Party (UNP) General Secretary Palitha Range Bandara has defended his call for postponing Sri Lanka’s presidential election by two years, claiming that his proposal was not undemocratic nor unconstitutional.

Speaking to reporters at the UNP headquarters Monday June 03 morning, Bandara also claimed that neither opposition leader Sajith Premadasa nor National People’s Power (NPP) leader Anura Kumara Dissanayake have spoken against his proposal.

“I have made no statement that’s undemocratic. My statement was in line with provisions of the constitution,” the former UNP parliamentarian said.

He quoted Section 86 of Chapter XIII of the constitution which says: “The President may, subject to the provisions of Article 85, submit to the People by Referendum any matter which in the opinion of the President is of national importance.”

Sections 87.1, 87.2 also elaborates on the matter and describes the parliament’s role, said Bandara.

“I spoke of a referendum and parliament’s duty. Neither of this is antidemocratic or unconstitutional. As per the constitution, priority should be given to ensuring people’s right to life,” he said.

“Some parties may be against what I proposed. They may criticse me. But what I ask them is to come to one position as political parties and make a statement on whether they’re ready to continue the ongoing economic programme,” he added.

Bandara claimed that, though thee has been much criticism of his proposal for a postponement of the presidential election, President Wickremesinghe’s rivals Premadasa and Dissanayake have yet to remark on the matter.

“I suggested that [Premadasa] make this proposal in parliament and for [Dissanayake] to second it. But I don’t see that either Premadasa nor Dissanayake is opposed to it. To date, I have not seen nor heard either of them utter a word against this. I believe they have no objection to my proposal which was made for the betterment of the country,” he said. (Colombo/Jun03/2024)

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300 of 100,000 trees in Colombo considered high risk: state minister

ECONOMYNEXT – Trees in Sri Lanka’s capital Colombo are being monitored by the municipal council, Army and Civil Defense Force as the severe weather conditions continue, State Minister for Defense Premitha Bandara Tennakoon said.

“Within the Colombo Municipal Council city limits, there are 100,000 trees. Of these, around 300 are considered high risk,” Tennakoon told reporters at a media conference to raise awareness about the current disaster management situation.

Not all trees required to be cut down he said. “We can trim some of the branches and retain them.”

The problem was that buildings in the vicinity of the tree had cut branches on one side, causing it to become unbalanced, the minister said.

New laws would be brought in so provincial/municipal institutions could strengthen enforcement of building codes.

“We don’t have a single institution that can issue a warning about a tree. Not one to tell us what trees can or cannot be planted near a road.

“Trees should be suitable for the area. Some trees have roots that spread and damage roads, buildings. When the roots can’t go deep, they tend to topple over.

“Now Environment Day is coming up, and anyone can go plant a tree by the road. We have to take a decision about this. We have to enforce laws strongly in future.” (Colombo/June3/2024)

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