2ND LOGISTICS CONFERENCE - 2017 TRINCOMALEE “Fostering Strategic Partnerships for Maritime Logistics” Date: 24th (Friday) March 2017

1. Innovations, Challenges, andInnovations, Challenges, and
Opportunities to Develop RegionalOpportunities to Develop Regional
Cooperation for Maritime LogisticsCooperation for Maritime Logistics
Dr. Lalith Edirisinghe, PhD

2. Presentation
agenda
1. Introduction
2. Maritime Industry And World Trade
3. Global Perception on Logistics Performance
4. Challenges
5. Opportunities
6. Innovations
7. Regional Cooperation in Maritime Logistics
8. Conclusions
2CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

3. Introduction
Maritime Logistics
The concept of integration, be it physical , economic/strategic
or organizational as an ongoing attempt to create greater
value for shareholders
(Panayides & Song, 2015)
Revolves around, Intermodal or Multimodal,
vertical integration, governance structure,
relational, people and process integration across organizations
3CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

4. Maritime
industry and
world trade
Shipping is a “derived demand” of world
trade
Demand for shipping is derived from the
demand of goods between countries
Size of world trade decides the demand for
shipping
World Trade Organization (WTO) provides a
platform to decide future strategies related
to trade
4CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

5. Growth in
merchandise
trade volume
by selected
country
grouping,
2013–2015
(Percentage change)
5CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

6. Maritime
Industry and
its
Commercial
Perspectives
80% of global trade by volume and
over 70% of global trade by value
are carried by sea and are handled by ports
worldwide
These shares are even higher in the case of
developing countries
UNCTAD
6CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

7. Maritime Logistics
Port Performance
Rank Port 2015 2014 2013 2012 2011
1 Shanghai, China 36.54 35.29 33.62 32.53 31.74
2 Singapore 30.92 33.87 32.6 31.65 29.94
6 Busan, South Korea 19.45 18.65 17.69 17.04 16.18
9 Jebel Ali, Dubai, United Arab
Emirates
15.60 15.25 13.64 13.30 13.00
12 Port Klang, Malaysia 11.89 10.95 10.35 10.00 9.60
17 Tanjung Pelepas, Malaysia 9.10 8.50 7.63 7.70 7.50
20 Keihin Ports, Japan 7.52 7.85 7.81 7.85 7.64
22 Laem Chabang, Thailand 6.82 6.58 6.04 5.93 5.73
26 Ho Chi Minh, Vietnam 5.31 6.39 5.96 5.19 4.53
27 Tanjung Priok, Jakarta, Indonesia 5.20 5.77 5.47 5.53 5.50
28 Colombo, Sri Lanka 5.19 4.91 4.31 4.26 4.26
34 Jawaharlal Nehru, India 4.49 4.45 4.12 4.26 4.32
35 Manila, Philippines 4.23 3.65 3.77 3.71 3.46
Top 50 World Container Ports (Volume in TEU
Millions -Selected ports)
7CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

8. "Shipping:
Indispensable
to the world"
A single ship can carry enough grain to feed
nearly four million people for a month;
another, enough oil to heat an entire city for a
year,
and others can carry the same amount of
finished goods as nearly 20,000 heavy trucks on
the road.
International Maritime Organization
8CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

9. Global
Perception
(LPI)
Source: The World Bank South Asia’s world rank in the Logistics
Performance Indicator (LPI)
Connecting to Compete -LPI results across four editions 2010, 2012,
2014, and 2016 (No. of countries evaluated 167) 9CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

10. Port of
Colombo
Actual
Performance
(Containers)
Type 2011 2012 2013 2014 2015 2016
Transshipment
TEUs
Laden 2766086 2717246 2855514 3278475 3395328 3873272
Empty 357742 347521 352603 421235 492993 481989
Sub total 3123828 3064767 3208117 3699710 3888321 4355261
Total
handlingTEUs
(Domestic
+Transshipment +
Re-stow)
Laden 3561674 3490696 3625098 4098284 4269749 4820622
Empty 701213 696424 681108 809631 915718 914301
Total 4262887 4187120 4306206 4907915 5185467 5734923
Transshipment as a % of
total
73% 73% 74% 75% 75% 76%
Empty as a % of Total 16% 17% 16% 16% 18% 16%
CINEC Maritime Campus- Malabe, Trincomalee, Jaffna 10

11. Sri Lanka: the
preferred hub
in South Asia
Deviation Time in Vessel Fuel Cost Port Access Cost of Total
Port Time Port Deviation Time ($)*** Charges time in Marginal
(Days*) Cost ($)*** ($)*** Port ($)** Cost ($)
Chennai 1.10 1.00 24,750 18,840 28,000 22,500 93,730
Chiitagong 2.25 1.00 50,625 37,800 22,500 22,500 130,925
Cochin 0.13 1.00 2,925 2,184 22,500 22,500 56,109
Colombo 0.06 1.00 1,350 1,006 10,000 22,500 34,858
Dubai 2.37 0.50 53,325 39,816 5,500 11,250 109,891
JNPT / NSICT 0.85 1.00 19,125 14,280 26,500 22,500 82,405
Karachi 1.33 1.00 29,925 22,344 20,000 22,500 94,769
Mundra 1.30 1.00 29,950 21,840 28,000 22,500 101,590
Tuticorin 0.09 1.00 2,025 1,512 33,500 22,500 59,537
Notes : All figures in US$ * At 23 Knots, ** At US$ 22,500 per day for a 4,000 TEU vessel *** At 120 tpd x US$ 140/t
{Source: Drewry Shipping Consultants Ltd/SAGT)
Competitive Port Terminal Facilities
CINEC Maritime Campus- Malabe, Trincomalee, Jaffna 11

12. Challenges
1. Low demand and oversupply
2. Security threat
3. Environmental regulations
 Maritime transport emits around 1000m tonnes of CO2 annually
 This accounts 2.5% of global greenhouse gas emissions
1. Global shortfall of competent workforce in maritime sector and
declining demand for freshers
 World fleet is registered in over 150 nations
 Manned by more than a million seafarers of virtually every
nationality
1. The container inventory imbalance costs USD 15 Billion a year
globally
20% of containers transported by sea and 40% by land are empty
1. Alliances and M&As
12CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

13. Challenges
specific to Sri
Lanka
1. Volatility of Freight (being the last loading port E/W
and oversupply)
2. Ever increasing Empty Reposition Cost in Sri Lanka
over USD 100 Million a year
3. Deteriorated vessel deployments for Sri Lankan
Cadets
4. Heavy dependency on Transhipments
 Currently, over 27.4% of India's export/import cargo is
transhipped at foreign ports
 Sri Lanka depends on transhipment volumes of Indian
t/s cargo
 The Indian Cabotage rules allow the foreignflagged vessels
to carry cargo only if Indian flagged vessels are not
available
13CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

14. Opportunities
Source: www.containersindia.in (2016)
'Strengthening Maritime Cooperation for a
Peaceful, Stable and Prosperous Indian Ocean'.
Indian Ocean Rim Association (IORA)
14CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

15. Trade
Agreements:
the Key to
Booming
Maritime
Logistics
15
Sri Lanka Participation in Goods and Services RTAs
CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

16. Ownership of
World fleet:
the Regional
Strength
Source: UNCTAD secretariat calculations, based on data from Clarksons Research.
Note: Propelled seagoing merchant vessels of 1,000 gross tons and above, as at 1 January
CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

17. Opportunities
for Regional
Cooperation
1. The region is showing greater opportunities for shipping and
logistics businesses
2. One Belt- One Road Initiative
 India High-speed rail cooperation;
 industrial parks, Gujarat and Maharashtra
 Pakistan China–Pakistan economic corridor
 roads and railway
 port upgrades, including airport
 power plant and roads
1. Sri Lanka Deepwater port in Hambantota
2. China Merchants Holdings International investment in Port of
Colombo
Source: The Maritime Transport Review- 2016
17CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

18. Regional
Cooperation
to Improve
Occupation
al Standards
IORA team inspecting Port Patrick-
in Sydney Australia
Sri Lankan
representatives of IORA
Port Occupational
project in the SL High
commission office in
Canberra to brief the
project development
The members of IORA Port
Occupational project in port of
Colombo
2015
Team visiting the
“Ship in Campus” at
CINEC –Malabe- Sri
2016
18CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

19. Carrier
Centred
Approach that
leads to
Regional
Cooperation
Virtual Container Pool -VCP
®
The Concept of Virtual Container Pool –VCP is created by the Author and Developed by Dalian
Maritime University and CINEC Maritime Campus. All Rights Reserved.
®
19
Container Exchange Mathematical Model

20. Innovations
and the way
forward
Shipboard Autonomous
Fire Fighting Robot
Hull Cleaning Robots
This can be guided by smartphone or tablet. 20CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

21. Innovations
and the way
forward
Anti-Piracy Robots
Robot Ship Inspectors
A robotic unmanned
surface vehicle (USV)
developed by US Navy
Unmanned robotic
vessels can help to fight
piracy as well for which
researches are going on.
21CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

22. Innovations
and the way
forward
Marine Traffic Automatic
Identification System
Transmits position, speed, and course
from the vessel and satellite tracking
capabilities for these ships out of range.
Holland Container Innovations-
4FOLD
SkySails drive for cargo ships
22CINEC Maritime Campus- Malabe, Trincomalee, Jaffna

23. Presentation
summary
1. World Trade influence on Maritime Industry
2. Global Logistics Ranking for South Asia
3. Challenges, Opportunities, and Innovations in
Maritime Logistics
4. Develop Regional Cooperation to overcome
barriers
 Comparatively greater population in the Region
 IORA -Capacity building
 WTO RTA– Increase trading within the region
 Ownership of World fleet
 Virtual Container Pool -VCP
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®

24. Credits:
1.International Maritime
Organization
2.The World Bank
3.World Shipping Council
4.Indian Ocean Rim Association
5.Ceylon Association of Shipping
Agents
6.Sri Lanka Ports Authority
7.CINEC Maritime Campus
8.Dalian Maritime University
9.www.marineinsight.com
10.www.pridel.com
11.www.containersindia.in
12.D.-W Song, & P. Panayides
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