Dutch development bank FMO , working together with the Bangladeshi institution Infrastructure Development Company Limited (IDCOL), have signed an agreement to provide a senior corporate loan amounting to $30.51 million to Summit Alliance Port Limited (SAPL) in Bangladesh. The funds will be used to develop SAPL’s container handling activities. The $30.51 million is made up of a $20.51 million loan from FMO and a $10 million loan from IDCOL. The funds will be used to expand SAPL’s current container handling business by developing container transport by river as a cost competitive, efficient, innovative and more environmentally friendly (Transport Modal Shift) alternative for transport by truck. Due to the substantial reduction/avoidance in GHG emissions, the transaction can be labelled as 100 per cent green. SAPL’s director, Fazlul Haque says: “SAPL is very delighted to work with FMO and IDCOL to develop our river terminal project. This is a 1st of its kind in the private sector in Bangladesh with impact on economic growth, ultimately contributing to the national development.” Since the start of commercial operations in 2007, SAPL has become the leading Bangladeshi company providing off-dock services, including Inland Container Depot (ICD) services, and Container Freight Station services. ICD services comprise of transportation and storage of empty containers (Empties) as well as re-delivery of the Empties to various locations as per client’s advice. SAPL’s container yard and warehouses are located close to the port of Chittagong, which is the country’s principal sea port. The cargo hinterland from Dhaka and surrounding area is estimated to generate about 70 per cent of total cargo throughput in Bangladesh. Chittagong is located 265km away from Dhaka, mainly accessible via national road 1 (Dhaka-Chittagong highway). Road transport is being hampered by heavy congestion and poor road conditions. Despite upgrading, the situation is only expected to worsen with projected volume growth in the years to come. Infrastructure is the backbone of economic development. Therefore, the project to move more container transport to river haulage will be highly developmental as it will improve cargo handling capacity in the country. The development is much needed to keep up with demand. Furthermore, it will strengthen Bangladesh’s international trade, which plays a significant role in fuelling the country’s economic growth – a crucial factor for poverty alleviation. FMO’s CIO Linda Broekhuizen comments: “FMO is very pleased to support the much needed improvement of the basic infrastructure in Bangladesh, contributing to the economic growth and job creation in the country.”
