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Moving car imports from Colombo Port to Hambantota Port

Importers claim the move a Trojan Horse

By Azhar Razak
The Ceylon Motor Traders Association (CMTA) last week expressed their anger to a plan mooted by the Sri Lanka Ports Authority (SLPA) Chairman, Dr Priyath Bandu Wickrama to move the clearance facilities of all car imports from Colombo to the Hambantota Harbour claiming that logistically it was not practical. Their stance is that since the majority of buyers are from the Western Province, such a move would only make the vehicles more expensive to the consumer with additional transport costs to be borne among a series of other logistical issues to be addressed in such an implementation.
“It is his (SLPA Chairman’s) own version and nobody has so far discussed this with us. However, such an initiative is not feasible unless solutions are found to a gamut of arising problems,” CMTA Chairman Tilak Dias Gunasekera told The Bottom Line.
He cited practical issues such as relocating Pre-Delivery Inspection (PDI) officers from Colombo to Hambantota, extra cost factors involved in the transport of thousands of cars from Hambantota to Colombo, risk of damage in transport among many other issues that would resultantly crop up.
The CMTA chairman observed that the Colombo Port is presently only facing a temporary issue with regard to the backlog of vehicles stranded at the port since the government is yet to take a decision on whether or not to clear imported used vehicles over two years. This is because in April 2011, along with tariff revisions the Customs Department relaxed the regulation pertaining to the importation of used petrol cars, from 3.5 years to 2 in a move to encourage the importation of brand new cars and also encourage expatriates to bring in brand new vehicles for private usage, minimising the foreign exchange outflow.
“There is a dispute between customs and used car dealers who have imported cars older than three years over the clearance of vehicles. Since the Customs stay put on the new two-year rule, traders cannot clear them. This delay has trickled down to new car imports as well due to space constraints at the Port,” claimed Gunasekera who insisted that if this issue was resolved without much fuss then the shifting vehicles to Hambantota for clearance would not arise.
The SLPA Chairman, Dr Wickrama had suggested the plan when he addressed a news conference last week to announce Colombo hosting the 12th Asia/Oceania Regional Meeting and Port Forum on March 8 and 9, 2012 and also the International Air Freight, Shipping and Logistics Expo 2012 from March 8 to 12.
“So far we have always had problems because thousands of cars kept at the port awaiting clearance. The cars are kept outside of the port and the clearance delay results in more expense.”


If the cars are instead brought to Hambantota then there is plenty of space and clearance would be faster. Importers would also have the benefit of reduced tariff charges. The only issue is the modality by which they can be transported to Colombo, otherwise the importers are keen,” SLPA Chairman Dr Wickrema is reported to have stated.
Meanwhile, the Chief Executive Officer of United Motors Plc, Chanaka Yatawara said that their firm was not ready to a shift in Port idea since majority of its customers came from the Western Province.
“Apart from additional costs, this will also create greater congestion on roads while there will be a risk factor that needs to be taken into account,” he noted.


Posted on Monday, August 08, 2011 @ 09:38:42 LKT


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