Business

The X-Press Pearl disaster and the imperative for regional maritime cooperation

Published

5 years ago

2021/08/10

Sahan Weerasooriya

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
Fishing Activities

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.

Moving Forward

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:

Righting the Ship: The X-Press Pearl Disaster and the Imperative for Regional Maritime Cooperation

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 – githmi@ips.lk)

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Business

Climate damage costing Sri Lanka over Rs. 50 billion annually; private capital key to recovery and growth

Published

16 hours ago

2026/06/11

Sahan Weerasooriya

Azusa Kubota

– UNDP Resident Representative Azusa Kubota

Sri Lanka’s climate crisis is no longer merely an environmental challenge but a growing economic threat that is inflicting losses exceeding Rs. 50 billion annually, while placing immense pressure on public finances, investment flows and long-term economic stability, according to United Nations Development Programme (UNDP) Resident Representative Azusa Kubota.

Delivering the keynote address at the Climate Summit organised by the Climate Action Committee of the Ceylon Chamber of Commerce, Kubota said the country urgently needs to transform climate ambition into investable projects capable of attracting private capital, strengthening resilience and driving economic growth.

“Climate change is no longer a distant environmental issue. It is already a risk shaping markets, supply chains, trade, investment and human development. It is fundamentally an economic and development issue,” she stressed.

Kubota warned that climate volatility is intensifying in real time, citing forecasts from the World Meteorological Organisation indicating an 80 percent probability of El Niño conditions during the June-August period, rising to over 90 percent later this year.

For Sri Lanka, this could mean weaker rainfall, higher temperatures, greater pressure on agriculture and hydropower generation, and increased risks to water security, food production and business continuity.

The UNDP official noted that the devastating impacts of recent climate-related disasters had exposed the vulnerability of the economy. Following last year’s severe weather events, the Government’s Post Disaster Needs Assessment estimated damages of approximately Rs. 618 billion, while recovery requirements over the next three years are expected to exceed Rs. 1 trillion, with nearly half the losses concentrated in infrastructure.

“Public finance alone will not be sufficient. Private capital must be strategically directed towards bridging these enormous financing gaps,” she said.

Kubota highlighted that global climate finance reached a record USD 1.9 trillion in 2023, while private climate finance surpassed USD 1 trillion for the first time. However, she pointed out that the world still requires approximately USD 6.3 trillion annually through 2030 to remain on track with climate goals.

“The capital exists. But it will only flow at scale where policies, institutions and project pipelines are credible,” she observed.

She said Sri Lanka has made significant progress in strengthening its climate policy framework through the updated National Climate Change Policy, Nationally Determined Contributions (NDC 3.0), sectoral transition plans and the recently Cabinet-approved Climate Finance Strategy.

However, she cautioned that policy ambitions alone are insufficient unless backed by strong implementation mechanisms.

“The private sector does not invest on the basis of ambition alone. Businesses invest where policy is credible, institutions are clear and projects can move from concept to execution,” Kubota said.

She stressed that investors require certainty regarding procurement systems, regulatory frameworks, financing mechanisms, revenue models and governance structures before committing capital.

The UNDP representative identified renewable energy, energy efficiency, industrial decarbonisation, waste management, circular economy solutions, climate-smart agriculture, ecosystem restoration, resilient infrastructure and carbon markets as sectors with substantial investment potential.

She also pointed to Sri Lanka’s emerging carbon market framework under Article 6 of the Paris Agreement as a potentially significant source of climate finance and international partnerships.

“These are not technical details. They are the conditions that determine whether market interest becomes a credible investment,” she said.

Kubota further noted that Sri Lanka’s first Biennial Transparency Report (BTR), submitted to the UN Framework Convention on Climate Change, provides valuable insights into policy, financing and implementation gaps that need to be addressed.

According to her, transparency and accurate climate reporting are increasingly important not only for international compliance but also for investor confidence, risk assessment and financing decisions.

She urged stronger collaboration between government agencies, financial institutions, industry leaders and development partners to accelerate implementation of climate commitments.

“Climate policy succeeds when it becomes economic policy, and when the private sector becomes a co-owner of implementation, resilience and recovery,” she emphasized.

Kubota said resilience should be viewed not as a social cost but as a strategic economic investment.

“Building back better is not simply a humanitarian imperative. It is central to protecting supply chains, lowering long-term costs and strengthening economic confidence,” she noted.

She added that investments in resilient infrastructure, insurance, climate-smart agriculture, water efficiency, early warning systems and sustainable construction could create entirely new markets and competitive advantages for Sri Lanka.

Looking ahead, Kubota called for stronger alignment between NDC 3.0, the country’s long-term economic vision, emerging carbon market frameworks and financing mechanisms.

“The task now is to connect policy to projects, projects to finance, and finance to measurable results for people, businesses and communities,” she said.

She reaffirmed UNDP’s commitment to supporting Sri Lanka through initiatives including climate investment pipeline facilities and the proposed Canopy Fund, a blended finance mechanism designed to mobilise investment for nature-based solutions.

“The decisions we make today will shape not only Sri Lanka’s climate future, but its economic future as well,” Kubota concluded.

By Ifham Nizam

Business

David Pieris Automobiles opens Sri Lanka’s first GWM Flagship Experience Centre

Published

16 hours ago

2026/06/11

Sahan Weerasooriya

One of first GWM customers receiving the keys from Rohana Dissanayake, Group Chairman and Managing Director, David Pieris Group of Companies

A new era of premium mobility begins at Union Place, Colombo 02

David Pieris Automobiles (Private) Limited (DPA), the four-wheeler sales arm of the David Pieris Group, proudly announced the opening of its state-of-the-art GWM Flagship Experience Centre at 250, Access Tower 03, Union Place, Colombo 02, marking a significant milestone in the evolution of Sri Lanka’s automotive retail landscape.

GWM Flagship Experience Centre at Access Tower, Union Place,
Colombo 02

The newly opened flagship facility is designed to deliver a truly world-class automotive experience, showcasing the latest innovations and technologies from GWM, one of the world’s leading automobile manufacturers. As the first and only vehicle experience centre of its kind in Sri Lanka, it offers customers an immersive journey that goes beyond the traditional showroom concept. Visitors can explore GWM’s premium range of SUVs and electric vehicles, including the HAVAL H6 HEV, HAVAL H6 PHEV, HAVAL H6 GT PHEV, TANK 300 HEV and TANK 500 HEV, while enjoying dedicated vehicle demonstration zones, test-drive opportunities, and a host of innovative customer engagement experiences designed to redefine the vehicle purchasing journey. GWM’s product portfolio in Sri Lanka will be further expanded in the coming months with the introduction of several new models, including a range of fully electric vehicles.

GWM vehicles at the newly opened Experience Centre at Access Tower, Union Place, Colombo 02

With a legacy spanning over four decades, the David Pieris Group has earned a reputation as one of Sri Lanka’s most trusted automotive organisations, particularly for its comprehensive after-sales support and customer service excellence. Strengthening its commitment to GWM customers, DPA has already established a dedicated, state-of-the-art GWM service centre at No. 75, Hyde Park Corner, Colombo 02, supported by an expanding network of authorised service dealers across the island to ensure convenient and reliable customer care.

The state-of-the-art Flagship Experience Centre at
Access Tower, Union Place, Colombo 02.

Commenting on the opening, Mahesh Gunathilake, Director, David Pieris Automobiles, stated: “The opening of the GWM Flagship Experience Centre represents a significant milestone in our journey with the GWM brand in Sri Lanka. This is the country’s first dedicated state-of-the-art experience centre for GWM vehicles, offering customers the opportunity to experience world-class automotive technology, premium comfort and advanced safety features. GWM has successfully redefined modern mobility by delivering high-end luxury and innovation at an affordable price point, and we are proud to bring this exceptional experience to Sri Lankan motorists.”

GWM vehicles at the newly opened Experience Centre at
Access Tower, Union Place, Colombo 02

The opening of the flagship facility further reinforces David Pieris Automobiles’ commitment to expanding GWM’s presence in Sri Lanka, while providing customers with an unmatched ownership experience, backed by the Group’s renowned sales and after-sales expertise.

GWM vehicles at the newly opened Experience Centre at Access Tower, Union Place, Colombo 02

Customers interested in learning more about the GWM vehicle range, booking test drives or making pre-bookings can contact 011 7888 866, visit www.gwmsrilanka.lk or follow the GWM Sri Lanka by DPA Facebook page for the latest updates and promotions.

Rohana Dissanayake, Group Chairman and Managing Director, David Pieris Group of Companies, along with Mahesh Gunathilake, Director, David Pieris Automobiles (Private), cutting the ribbon to open GWM Flagship Experience Centre at the Access Tower, Union Place, Colombo 02.

One of first GWM customers receiving the keys from Mr. Rohana Dissanayake, Group Chairman and Managing Director, David Pieris Group of Companies

Business

Home Lands bets US$150m on Port City as it targets global property investors

Published

16 hours ago

2026/06/11

Sahan Weerasooriya

The Home Lands press conference held at Cinnamon Life - City of Dreams on June 9. From Left: Mario Offen - Deputy Director Sales and Marketing , Ashinsanie Weerasinghe - Head of Business Development and Marketing, Nalin Herath - Chairman and Managing Director, Amaya Herath - Executive Director, Rishad Mansoor - Deputy Director Marketing and Lanka Jayasinghe - Director Operations and Administration

Sri Lanka’s largest private real estate investment by Home Lands Group is set to test the country’s ability to attract foreign capital into the Port City Colombo project, with the upcoming unveiling of its US$150 million twin-tower residential development.

The company announced that its flagship project, Central Park Boulevard Port City Colombo, a 37-storey twin-tower development located within Port City’s Central Park District, carries an estimated end value exceeding US$300 million and has already sold about 50 percent of its units ahead of the official launch.

Speaking at a media briefing, Home Lands Chairman and Managing Director, Nalin Herath, said the project represents more than another luxury apartment development and is intended to position Sri Lanka within the international real estate investment market.

“The total investment is around US$150 million and the total value of the project is over US$300 million. This will generate a useful cash flow to the Sri Lankan economy,” Herath said.

The launch, branded as “The Grand Launch Weekend”, will be held from June 12 to 14 at Cinnamon Life and is expected to attract around 1,800 invitees, including business leaders, professionals, artists, celebrities and international guests.

Herath said changing conditions in regional property markets had created an opportunity for Sri Lanka to compete for international investors.

“The current geopolitical tensions in the Middle East have adversely affected segments of the property market in the Gulf region, particularly Dubai. This creates an opportunity for us to enter the global real estate market. Port City is the ideal location because it has the infrastructure and resources required to cater to that market,” he said.

His comments came amid growing confidence that world-class infrastructure would draw international capital into the Port City ecosystem.

Home Lands’ latest project therefore represents one of the most significant private-sector bets yet on Port City’s future growth prospects.

Responding to concerns regarding the source of investment flows, Herath said the necessary regulatory safeguards were already in place.

“Government regulations and the Port City Commission’s compliance frameworks ensure that the project attracts legitimate institutional and private funds,” he told The Island Financial Review in response to a question.

The development will comprise more than 640 residential units overlooking Port City’s central green park and waterfront district. Home Lands describes the project as Sri Lanka’s first high-rise residential development inspired by an international ultra-luxury lifestyle brand.

The company, which has delivered approximately 3,750 apartments and villas across Sri Lanka and has more than 2,200 units currently under construction, is positioning the project as a landmark investment capable of generating foreign currency inflows as well as creating thousands of jobs.

The unveiling will also mark one of the biggest real estate launches ever staged in Sri Lanka, with former Sri Lanka cricket captain Mahela Jayawardene serving as the project’s brand ambassador.

For investors and policymakers alike, however, the larger question extends beyond the launch itself: whether Port City can evolve from a high-profile development concept into a functioning international financial centre, as envisaged when the project was first conceived.

By Sanath Nanayakkare