Daily Mirror - Print Edition

Local NVOCC sector thrives in face of global conflicts: Stakeholders

11 Jun 2024 - {{hitsCtrl.values.hits}}      

  • Say has gained much-needed credibility from industry peers and local authorities over past few years
  • Point out NVOCCs plays a crucial role in ensuring a free flow of trade between SL and its trade partners, particularly Middle East and Russian markets
  • Note India offers boundless opportunities for SL’s NVOCC industry





  • By Nishel Fernando 

Sri Lanka’s non-vessel operating common carrier (NVOCC) space is seeing high demand and rising opportunities emerging from the war in Eastern Europe and conflict in the Middle East, after gaining the much-needed credibility from the industry peers and local authorities over the past few years.  

Speaking at the seventh Annual General Meeting of the Sri Lanka Association of NVOCC Agents (SLANA), industry veteran and Lanka Shipping and Logistics Founding Chairman Saliya Senanayaka highlighted that Sri Lanka’s small and medium enterprise (SME)-dominated NVOCC sector now sits on a solid ground for future, after gaining credibility, despite the years of resistance.

“There was a lot of resistance for the operations of the NVOCCs and to replace the NVOCCs years back,” he said.
He compared the resistance faced by the NVOCCs in Sri Lanka to the resistance faced by the freight forwarders in the initial years of liner shipping in Sri Lanka.

During the past year, the Merchant Shipping Secretariat created a new licensing category, especially for the NVOCCs, which allowed the NVOCC agents to apply for direct billing. This, in turn, prompted the Sri Lanka Port Authority, in collaboration with the private terminals, to formulate a new set of basic requirements for the NVOCC agents, to secure direct billing facilities, instead of depending on the feeder principals. 
Meanwhile, SLANA immediate Past Chairman Harsha De Silva outlined the emerging new opportunities for the NVOCCs, in particular, due to the global conflicts.

“Currently, due to the war in Eastern Europe and conflict in the Middle East, affecting the Red Sea passage, have given rise to new NVOCC operators and the new trade lanes going up to the Mediterranean and European ports,” he said.

He also pointed at the increasing trend in the NVOCC principals venturing into container feeder vessels through associate companies.

“We have also seen large NVOCCs, amalgamating with feeder operators to form strong regional shipping lines and these trends also set to continue,” he added.
Meanwhile, the newly elected SLANA Chairperson Swabha Wickramasinghe highlighted that the NVOCCs play a crucial role in ensuring a free flow of trade between Sri Lanka and its trade partners, in particular the Middle Eastern and Russian markets.  

“The NVOCCs play a pivotal role in transporting goods to regions where the main line operators face restrictions, notably in certain Middle Eastern sectors. Our entry into the Russian market, the second largest buyer of Ceylon Teas, shows the steadfast growth of our industry,” she added. 
In addition, she noted that India offers boundless opportunities for the NVOCC industry. Similarly, China, Malaysia, Singapore and the UAE contribute significantly to the import and transshipment volumes of Sri Lanka’s NVOCC industry.

However, she noted that the government support is required to address some of the challenges, given the NVOCC industry in Sri Lanka remains predominately SMEs.

“As we navigate through dynamic geopolitical landscapes, characterised by sudden shifts, we must remain proactive and resilient. The challenges ahead require collective readiness and adaptability. While our industry predominately comprises SMEs, lacking the resources of larger corporations, we rely on the support of the government, relevant authorities and private sector cooperatives, to foster an environment beneficial to business growth,” she said.