German logistics companies are keen to increase their operations and investments in Sri Lanka if there is a more optimized regulatory frame, chief delegate of the Delegation of German Industry and Commerce in Sri Lanka (AHK Sri Lanka) Andreas Hergenröther told a logistics conference in Colombo last week.
“With the right regulatory frame German Companies could be strategic partners for Sri Lanka to achieve its target of becoming a leading logistics hub in Asia,” he said.
Some of the world’s largest logistics companies of German origin such as DHL, Hellmann, DB Schenker, Kuehne & Nagel, the world’s 5th largest shipping line Hapag Lloyd, Mercmarine and Hamburg Sued have been operating in Sri Lanka for decades.
“While the companies already in Sri Lanka are keen to expand, several other companies plan to come to Sri Lanka,” he told the first German-Sri Lanka Logistics Conference in Colombo last week. “As the official representative of German business in Sri Lanka, AHK Sri Lanka is strongly committed to fair business, level playing field, free trade and liberalization.
Until today foreign companies operating in freight forwarding and shipping are restricted to be minority shareholders of max. 40%. Companies that want to provide bonded warehousing services as Multi Country Consolidation need to have a minimum capital of US$ 5 million. Hence, many foreign investors were very reluctant to conduct further or new investments,”
AHK Sri Lanka has coordinated in the frame of the Sri Lankan pavilion at the world’s leading logistics fair Transport Logistics the visit of Sri Lankan Ports Minister Sagala Ratnayaka to Munich and Berlin in the beginning of June 2019. About 200 decision makers including German Vice-Minister of Transport and Digital Infrastructure Steffen Bilger attended the conference where they discussed opportunities and cooperation in developing the island’s logistics status.
“There is a profound industry driven logistics know-how in Germany, which has been a key factor for Germany’s economic success. Logistics is a top priority. In fact, Germany has been ranked for many years at rank Number 1 in the World’s logistic performance index.” The index which includes the 6 main categories Logistic competence, tracking and Tracing, Timeliness, infrastructure, international shipments and Customs is yearly published by the World Bank and classifies 160 countries.
The high logistics performance of Germany conducted essentially to the fact that Germany with a total export volume of about 1,5 trillion USD has become for many years the world’s export champion, realizing for many years the highest trade surplus (227 billion Euro) in the world.
The global competitiveness of industries and countries depend today more than ever on the capacities to transport goods just in time in a transparent and very cost-effective way integrating intelligent service solutions according to the individual needs of the customer. Therefore, highest performance standards of ports, terminal operators, shipping lines, freight forwarders and warehouses are needed. Digitalization, intelligent storage and tracing a tracking system are key factors of success. Topics such as intelligent warehousing, E-Commerce, 4-PL, project logistics as well as the needed regulatory set up were at the centre of the discussions.