SRI LANKA WANTS TWO SHIPS TO TRANSPORT AID TO JAFFNA FOR

UNCLAS COLOMBO 001935 SIPDIS SENSITIVE, SIPDIS DRL/IL FOR LAUREN HOLT STATE FOR SA/INS MCC FOR D NASSIRY AND E BURKE E.O 12958: N/A TAGS: ECON EINV ETRD SOCI EAID CE SUBJECT: SRI LANKA WANTS TWO SHIPS TO TRANSPORT AID TO JAFFNA FOR ONE YEAR REF: COLOMBO 1863 ¶1. (SBU) Ambassador Blake called on Minister Rohitha Bogollagama November 14 at the Minister's request to discuss the procurement of shipping services to Jaffna, Sri Lanka's northern city which is currently suffering a shortage of necessary supplies due to the closure of the A-9 highway. Bogollagama is Minister of Enterprise Development and Investment Promotion, and has been a delegate to several recent peace talks with the Liberation Tigers of Tamil Eelam (LTTE). Some Progress in Supplying Jaffna -------------- ¶2. (SBU) Bogollagama explained that he is in charge of logistics to supply the north, which has been facing serious shortages. As noted in reftel, the Government of Sri Lanka (GSL) has begun shipping relief supplies to Jaffna via the nearby port of Kankesantural (commonly referred to as KKS). Bogollagama told the Ambassador that fifty percent of the month's requirements have now been shipped. The GSL wants to establish one month of basic reserve supplies in Jaffna, and now has a 10 day reserve. Wants Two Ships; 3500 Metric Ton Capacity Each -------------- - ¶3. (SBU) Noting that this need for shipments could go on for some time, Bogollagama requested assistance in contracting two vessels, each with 3500 metric ton capacity to transport food and other supplies from southern Sri Lanka to KKS. He added that the GSL would take it on a "dry lease," that the GSL would pay total cover for the vessels, and that the owner's crews could operate the vessels. ¶4. (SBU) The Ambassador asked about the need for such shipping if the A-9 highway could be reopened on at least a weekly basis for relief shipments. Bogollagama demurred, replying that a weekly convoy would require a massive fleet of vehicles in order to ship what just one seagoing vessel could supply to Jaffna. He also noted that shipping is far cheaper for bulk cargo. He suggested the A-9 might better be opened to allow safe passage of people back and forth, although clearly a mechanism would be needed to check the identities of such people to ensure the LTTE would not take advantage of this. (Note: this idea is Bogollogama's and not an official GSL view.) Point Pedro Development Desired -------------- ¶5. (SBU) Bogollagama also explained that shipping logistics needed enhancement in the north of Sri Lanka. Currently, containers need to be shipped only partially full, and once arriving near the port, must be transferred to smaller vessels before reaching land. The Minister expressed interest in entering into a public-private partnership for the development of Point Pedro, estimating that the project would be worth approximately USD 100 million. Comment -------------- ¶6. (SBU) Utilizing Sri Lanka's territorial waters could be an efficient shipment method. Bogollagama's desire to secure two vessels indicates reasonable planning and a potential commercial opportunity, if the terms are appropriate. In the current security situation, however, we don't anticipate that many will be interested in developing the port at Point Pedro. BLAKE