Righting the Ship:
By Githmi Rabel
On 20 May 2021, Sri Lanka’s worst-ever marine disaster occurred when a fire erupted on the Singapore-registered MV X-Press Pearl container ship just 18 km Northwest of Colombo. While the long-term cost is yet to be determined, the negative impact on industries such as fisheries and tourism, and people who rely on the coastal resources of Sri Lanka is already apparent. This article examines the key consequences of this disaster on Sri Lanka’s coastal economy and highlights the need to enhance regional maritime cooperation to prevent the recurrence of such disasters.
Impact on Fisheries and
The fisheries industry is an important sub-sector of the Sri Lankan economy; it accounts for 1.3% of GDP at current prices, exhibited a growth rate of 9.9% and accounted for 1.5% of export earnings in 2019. It is also a source of many direct and indirect employment opportunities from fishing to processing, distributing and trade and boat-building and maintenance. Approximately 583,000 individuals are employed in this industry and there is a supporting workforce of 2.7 million. It is also crucial to note that fish contributes more than 60% of all animal protein consumed in Sri Lanka and is the main source of protein for low-income groups.
However, following the fire and the consequent spill of nitric acid and plastic pellets into the sea and nearby coast, fishing was temporarily banned along an 80 km stretch of the coast. The effect on the local community has been stark, with some estimates claiming that around 16,000 fishers were affected. The X-Press Pearl fire, which disrupted the fisheries supply chain, from fishers to processors to wholesale and retail traders, made the fishing community more susceptible to the structural economic and social inequality they already faced. The coastal fishing community, one of the three sub-sectors of the fisheries sector of Sri Lanka, is the most vulnerable as they are daily income earners. The loss of even a single day’s income severely affects the ability of a fisher’s family to meet their basic needs. Furthermore, for most involved in this industry, there are no alternative means of income.
Of the LKR 720 million compensation received by the government, LKR 420 million has been set aside for the fishing community affected by the fire and fixed prices have been set for fishing gear and equipment in consultation with relevant businessmen. But it is important to understand the context in which this marine disaster occurred: the fisheries industry was already severely impacted by the pandemic. Islandwide curfews, cross-border mobility restrictions and trade regulations led to various constraints on access to necessary equipment and markets.
Ecological Impact and Tourism
Sri Lanka’s coastal tourism is heavily dependent on its rich marine biodiversity. The plastic waste and potential oil spills from the ship threaten not only the beaches and seas which are home to sensitive ecosystems such as lagoons and coral reefs but also its marine life.
The Marine Environment Protection Authority (MEPA), the main government body responsible for marine pollution, has stated that the plastic waste from the ship has probably caused the “worst beach pollution in our history,” and will lead to years of ecological damage. For example, the marine pollution caused by the fire is responsible for the death of 200 marine animals —including 176 sea turtles, 20 dolphins and four whales— as of now. Plastic pellets, which are easily carried by the tide, attract toxins from the water and can cause death if ingested by marine life, have washed ashore from Puttalam to Matara. Despite various efforts such as beach cleanups, the attempt to restore the coast is ongoing.
The coast has lost much of its former beauty and attraction, and out of 15 tourist zones, eight have been affected by the fire. Furthermore, the damage caused to fish breeding areas will result in lesser yields of crabs and jumbo prawns, which are especially consumed by foreign tourists. The fear of contamination and reduced supply of these items will have an immediate financial impact on the coastal economy. There is also the fear that toxic chemicals will damage the coral reef which takes years to regenerate. This depletion and ruin of coastal resources will have a spillover effect on both the fishing community and tourism leading to a mid-to-long-term economic impact.
This is not the first ship fire or oil spill that has occurred in Sri Lankan waters, with the MT New Diamond ship fire in 2020 being one of the most significant. Sri Lanka’s position in the middle of many sea and trade routes in the Indian Ocean, where around 200 to 300 ships —mainly oil tankers from the Persian Gulf to East Asia—pass daily, makes the country especially vulnerable to marine accidents.
The X-Press Pearl fire was controlled only after Sri Lanka received emergency support from India, and this clearly highlights the inadequacies of current institutions to handle a crisis of this scale. While Sri Lanka does have a domestic structure in place to prevent and manage marine pollution, it is crucial that the country works closely with others in the region to achieve the same. Currently, the MEPA has the authority to implement the National Oil Spill Contingency Plan (NOSCOP) which allows the mobilisation of support from the navy, coastguard and the Sri Lanka Ports Authority. However, the emergency response system is too reliant on reactive responses as opposed to more proactive approaches, which aim to not minimise the damage caused by marine pollution but to prevent it from occurring. This requires continuous monitoring of waters and heightened scrutiny, especially given that Sri Lanka is on a trajectory to become a maritime hub and expand its port capacity.
Sri Lanka can achieve this only through regional cooperation —with countries such as India, Pakistan and Bangladesh— that is based on the facilitation of knowledge, resource sharing, constant communication channels and the formulation of standardised security measures for responders. However, this must occur through a formal, binding mechanism for otherwise, any assistance provided will be purely voluntary and context dependent. For example, requests made to offload the cargo at the Hazira port in India were denied which ultimately led to the X-Press Pearl fire on Sri Lankan waters. Given that the increase in maritime traffic has not led to a proportional increase in response capacities in countries such as Sri Lanka, official regional cooperation is key in preventing marine accidents and protecting shared waters.
Link to Original Talking Economics Blog:
Githmi Rabel is a project intern at the Institute of Policy Studies of Sri Lanka (IPS). She is an undergraduate at New York University – Abu Dhabi, majoring in Economics with a minor in Social Research and Public Policy. (Talk with Githmi – firstname.lastname@example.org)
DFCC Bank’s Ranwarama pawning facility lends a helping hand to those with urgent cash requirements
DFCC Bank has increased the advances of its “DFCC Ranwarama” Pawning Facility as a solution for families to meet their urgent cash requirements as many families are experiencing financial difficulties due to the COVID-19 outbreak that has had a significant impact on the Sri Lankan economy.
Through this scheme, all Sri Lankan citizens over 18 years of age with the contractual capacity to declare themselves as owners of the articles can now pawn gold or gold jewellery. DFCC Bank accepts jewellery made of 18 Karat -24 Karat gold, with the articles being assayed using the latest available equipment. Items of 24 Karate will hold an advanced value of LKR 82,000/-, while 22 Karat pieces will hold an advanced value of LKR 68,000/- at an interest rate of 0.75% per month. Those who engage in these transactions are provided a maximum of 12 months to settle the pawning advances at their convenience.
DFCC Bank’s Ranwarama Pawning Facility offers many other special features including the highest advance amount at competitive rates of interest, confidentiality and guaranteed security for the articles, flexible payment plans with redemption options when required and redemption without prior notification. All of these facilities are available with no hidden charges, offering customers the best service available in the market.
You may visit a DFCC Bank branch closest to you to transact or visit the Bank’s website at www.dfcc.lk for further information. Customers can also contact DFCC Bank’s 24-hour contact center on +94(11)2350000 for further inquiries.
HSBC Sri Lanka recognised as the Best Consumer Digital Bank by Global Finance
HSBC has been recognised as the Best Consumer Digital Bank in Sri Lanka for 2021 by Global Finance at the World’s Best Consumer Digital Banks Awards in Asia-Pacific. While this is the bank’s fourth award win for this year, this also marks the 13th time that HSBC Sri Lanka has been named the Best Consumer Digital Bank, since 2006.
HSBC Sri Lanka is also the only market in Asia Pacific to win the prestigious award this year.
According to Global Finance, the global health crisis accelerated the need for digital and contact-free solutions by banks in helping create safe and efficient banking services for customers. HSBC Sri Lanka was quick to react in supporting customers in providing seamless digital bank offerings in an increasingly demanding environment, while ensuring customers have a secure banking service with a full spectrum of client-centric banking services.
Through its wealth of digital capabilities and offerings, HSBC allowed customers to adopt a mobile-first approach, and provide them with faster, easier and more secure banking services 24/7. The bank introduced a virtual on boarding capability for account opening, loans and credit cards supported by Adobe Live Sign, eKYC and virtual PINs to provide a seamless on boarding experience for customers. HSBC also offers credit card activation through SMS and an e2e virtual registration process for online banking, offering a virtual banking experience.
In Sri Lanka more than 90% of its personal customers now use digital channels including mobile banking, e-wallets, real-time cash deposit machines and other digital services.
Nadeesha Senaratne, Country Head of Wealth & Personal Banking said, “We are truly honoured to be named the Best Consumer Digital Bank in Sri Lanka for 2021 by Global Finance in recognition of our digital capabilities, and delivering important everyday services and features that customers need and expect. As a leading international bank, we are putting the power of our bank in every customer’s pocket, with easier and more secure digital banking. We want to take the hassle out of everyday banking, and enable customers to easily manage their money online, from opening a new account in a few clicks, to making real time payments and accessing credit.”
Senaratne added: “We’re also blending the power of technology with the expertise of our people and empowering our frontline teams with the latest data and insights tools, to be better-equipped to check customer satisfaction in the moment, to understand, and respond to their evolving needs and give customers excellent service.”
Winners were selected by a world-class panel of judges and entries were judged based on the strength of strategy for attracting and servicing digital customers, success in getting clients to use digital offerings, growth of digital customers, breadth of product offerings and evidence of tangible benefits gained from digital initiatives.
Earlier this year, HSBC Sri Lanka was also named International Bank of the Year by Asiamoney and Finance Asia respectively, and International Retail Bank of the Year by Asian Banking & Finance.
BoardPAC appointed Strategic Partner of Commonwealth’s Business Network – CWEIC
BoardPAC, the Sri Lanka-based multinational Board meeting automation solutions company, has been appointed a Strategic Partner of the Commonwealth Enterprise and Investment Council (CWEIC), the organisation officially mandated by the Commonwealth Heads of Government to promote trade and investment between the 54 Commonwealth member countries.
This prestigious appointment will see CWEIC relying on BoardPAC’s award-winning solutions to conduct board and committee meetings with members and maintain relationships across the Commonwealth network at a time when the global pandemic’s complete disruption of business activity has resulted in a surge in the demand for efficient board meeting automation.
The Company said the partnership will also effectively promote the BoardPAC platform to new users and facilitate its expansion into new territories and focus markets. BoardPAC already has a global user base in excess of 50,000 and a presence in more than 40 countries.
Noting that BoardPAC’s latest partnership serves as yet another testament to the quality of its solutions, BoardPAC Co-Founder/CEO, Lakmini Wijesundera stated: “Our growth plan includes expanding our worldwide network, and our strategic alliance with CWEIC will strongly help us extend our presence into Commonwealth territories. The strategic cooperation between CWEIC and BoardPAC is especially relevant in light of the worldwide pandemic, and the emerging need for secure remote working and filling the void in virtual board meetings.”
CWEIC Chairman, Rt. Hon. Lord Jonathan Marland said: “We are looking forward to work closely with BoardPAC. The alliance will not only help CWEIC to conduct virtual board meetings securely and safely, but also align ourselves with all governance, risk and compliance as well as environmental, social, and governance frameworks.” Echoing this sentiment, CWEIC Deputy Chair, Sir Hugo Swire stated: “We are excited to partner with BoardPAC and extend modern digital governance and compliance solutions to organisations operating in the Commonwealth.”
Disclosing that BoardPAC’s excellent track record inspired confidence within the CWEIC to implement its solution on a global scale, CWEIC Chief Executive, Samantha Cohen CVO added: “We’re delighted that BoardPAC, one of the most renowned virtual board meeting automation providers in the world, joined our network of Strategic Partners. BoardPAC will add significant value to our board and committee meetings, allowing the CWEIC to conduct meetings with its members throughout the Commonwealth more effectively. The partnership also demonstrates the opportunities within the Commonwealth, and the confidence businesses have towards the Commonwealth and CWEIC.”
A commercial, not-for-profit membership organisation, the Commonwealth Enterprise and Investment Council’s network includes around 100 business and government Strategic Partners (members) including Standard Chartered, Zenith Bank, Trade & Investment Queensland and the Government of the Maldives from 30 countries and territories. Every two years, CWEIC hosts the Commonwealth Business Forum in association with the host country of The Commonwealth Heads of Government Meeting (CHOGM).
BoardPAC is an award winning, multinational, paperless board meeting automation solutions provider, recognised for driving simple, secure, sustainable and experiential communications for Board and Executive members. Leading corporates such as Petronas, Deloitte, EY, Mercedes Benz, Prudential, Hong Leong Group, Stock Exchange of Malaysia, Central Bank of Sri Lanka, Bombay Stock Exchange, Bank Negara, Maybank, Power Grid Corporation of India, Colombo Stock Exchange, and Sri Lankan Airlines are just some of BoardPAC’s success stories, and the Company said the partnership with the CWEIC will pave the way to several more high-profile additions to this list.
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