Sri Lanka Ports mulls tapping foreign funds for expansion

Sri lanaka: Sri Lanka’s Ports Authority (SLPA) is in the process of assessing the credit position to go for an international bond issue to raise funds for new expansion projects and repay debts, port sources said.

Since the SLPA is now assessing the credit position in the entity and after that only they are going to take a decision on this matter, its Chairman Saliya Wickramasuriya told the ‘Daily News Business’.

The Authority is making arrangements to get an international credit rating before making a bond issue to raise

funds, he told a shipping conference organised by the Sri Lanka branch of the Institute of Chartered Shipbrokers last week. “In order to explore the possibility of debt swapping via an international bond issue we have completed a credit assessment with Fitch Rating, the sources said.

They have planned to expand the scheme internationally into a full- blown international credit rating over the coming months, which may allow to gain access to bond markets. While it has the financial resources to undertake many of its own projects it also has the responsibility of repaying loans taken for previous projects.

The JCT, Colombo’s main deepwater container terminal, was built with Japanese aid. Colombo port carries a debt burden to the tune of US $1.5 billion in addition to its operating costs.

Most new port projects planned in Sri Lanka, apart from the new south port of Colombo, would not generate immediate commercial returns.

However, they were important from the point of view of the national economy as they would generate many spin off benefits to the rest of the economy, particularly under-developed regions of the island. These projects were seen as public interest infrastructure development projects, especially helping to develop rural areas.