Sri Lanka slips 2 places in UNCTAD’S latest shipping connectivity index

„■ Sri Lanka slips to 20th position in UNCTAD’S LSCI 2019 ■ „Colombo Port ranked as 19th best connected port ■ „China dominates both indices ■ „Investments by shipping lines enhanced port connectivity- UNCTAD

Sri Lanka slips two positions in the United Nations Conference on Trade and Development’s (UNCTAD) 2019 Liner Shipping Connectivity Index (LSCI), to 20th position.

The index showcases whether the countries have improved or worsened their positions in maritime transport networks.

Sri Lanka scored 62.61 points in LSCI for 2018, however, in 2019, Sri Lanka scored marginally lower in the index by scoring 62.12 connectivity points.“a country’s position in the global

container shipping network – its connectivity – is an important determinant of its trade costs and competitiveness,” said UNCTAD Chief of Trade Logistics Jan Hoffmann.

Despite the country’s setback in this year’s index, Sri Lanka was ranked eighth among the countries with the highest LSCI increases over the last 10 years with Vietnam recording the largest improvement.

Meanwhile, the Colombo Port was ranked as the 19th best connected port in UNCTAD’S 2019 ranking of the world’s bestconnected ports, scoring 63.52 connectivity points, slightly down from 64.04 points in 2018. In 2018, Sri Lanka’s sea ports handled 5862 ships, including 3736 container ships. The median stay at ports was recorded as one day for all ships and 0.8 days for container ships, while dry bulk carriers typically spent over three days on a port call.

However, the UNCATD stated that a longer time spent in the port does not necessarily mean that the port is less efficient, as the owners of ships may choose to have them stay longer in a port to purchase goods or services.

Sri Lanka and the Colombo Port retained the positions as the most connected country and port by sea in South Asia.

According to the index, China has retained its lead as the country best connected to others by sea. The country’s LSCI has increased by 51 percent since 2006. Further, Shanghai, China retained the top position as the world’s most connected port with a connectivity score of 134.3.

Among the top connected 20 ports, 15 are in Asia and 11 are in China.

The 2019, liner shipping connectivity index also includes a new component covering the countries that can be reached without the need for transshipment.

“Counting on a direct regular shipping connection has empirically been shown to help reduce trade costs and increase trade volumes,” Hoffmann said.

According to research, the absence of a direct connection is associated with a 42 percent lower value of bilateral exports. However, Sri Lanka had benefited from the cabotage restrictions of its larger neighbour India as these restrictions limit the options of connecting (feedering) services along the coasts. However, India lifted the restrictions last year.

The report noted that these restrictions helped Colombo to gain a higher LSCI than any Indian port.

Further, the UNCTAD pointed out that investments by shipping lines can attract additional services as seen in Pireas, Greece.

“It’s worth noting that Piraeus (Greece), operated by COSCO (China), has become the best-connected port in the Mediterranean in 2019. Other ports with Chinese investments that have seen their LSCIS go up include Colon (Panama), Khalifa (UAE) and Lomé (Togo). West African ports have attracted direct services from China, leading to larger vessels being deployed on these routes,” the UNCATD stated.

The country LSCI covers 178 countries and shows maritime connectivity trends from 2006 to 2019. It is calculated from data on the world’s container ship deployment and released annually.

The port LSCI provides 900 ports dating back to 2006 and it is generated using the same methodology as that for the released country-level.