Abstract

Sri Lanka’s strategic location allowed it to develop its Colombo port into a transshipment hub in South Asia. The Sri Lanka Port Authority decided to expand the Colombo port and develop the Hambantota port, with China Merchant Port Holding currently being a major stakeholder in Hambantota port. Using two different logit models, this study analyzes the potential competition between the Colombo and Hambantota ports for both domestic and transshipment container-handling; and ultimately incorporates this information to discuss the direction of Sri Lanka’s port developments. The results indicate that Colombo and Hambantota are appealing as domestic and transshipment container handlers, respectively. This study also analyzes the impacts of limiting slot capacity from liner services at Colombo, transport infrastructure development to Hambantota, and port charges and efficiencies, considering local shippers and consignees, shipping lines, and port authorities.

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