The terminal project is backed by Adani Ports, Sri Lankan conglomerate John Keells Holdings (JKH) and the Sri Lanka Ports Authority.
The deepwater West Container Terminal in Colombo is the US government agency’s largest infrastructure investment in Asia, and among its biggest globally. It will bolster Sri Lanka’s economic growth and “its regional economic integration, including with India, a key partner to both countries,” DFC said in a statement.
Colombo is the busiest transhipment port in the Indian Ocean and has been operating at more than 90% utilisation since 2021.
DFC CEO Scott Nathan commented, “Sri Lanka is one of the world’s key transit hubs, with half of all container ships transiting through its waters. DFC’s commitment of $553 million in private-sector loans for the West Container Terminal will expand its shipping capacity, creating greater prosperity for Sri Lanka – without adding to sovereign debt – while at the same time strengthening the position of our allies across the region.”
The project is billed as providing critical infrastructure for the South Asian nation with the potential to “transform Colombo into a world-class logistics hub at the intersection of major shipping routes and emerging markets,” according to the DFC.
“The $553 million investment by DFC for the long-term development of the Port of Colombo’s West Container Terminal will facilitate private sector-led growth in Sri Lanka and attract crucial foreign exchange inflows during its economic recovery," said US Ambassador to Sri Lanka Julie Chung. "Sri Lanka regaining its economic footing will further our shared vision for a free and prosperous Indo-Pacific.”
Beyond geostrategic symbolism, the new American investment at Port of Colombo is also the first time that the US government has invested in an Adani project. The Indian conglomerate said in a statement that the loan constitutes "a ringing endorsement of the Adani Group."
The funding of the Sri Lanka terminal is part of a global acceleration of DFC investments that totalled $9.3 billion in 2023.
Copyright © 2023. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited.