Two innovators Ferdinand de Lesseps and Malcolm McLean have deservedly won the title "shipping heroes". Lesseps (1805 -1894) conceived the idea of cutting a canal linking the red sea and Mediterranean as well as the Panama Canal across Central America linking the Atlantic and Pacific for navigation. He did what was considered impossible at the time and opened the Suez Canal in 1869. The idea for a canal across Central America may have existed for hundreds of years, but it was De Lesseps pioneering work that gave the idea credibility and which became a reality in 1915.

In 1882 De Lesseps visited Thailand but was not allowed to investigate in detail the construction of the canal by the Thai king.  On June 13th, 1882 De Lesseps asked King Rama V for permission to construct the Kra canal.  Permission was refused by the king due to international political problems existing at that time. In 1897 Thailand and the British Empire agreed not to build canal there to protect the dominance of Singapore.

Malcolm McLean (1914-2001) who earned the title "father of containerization" revolutionized not only global shipping services but international trade as well. He was the lynch pin of today’s globalization. It took 20 years to bring the idea to life. But after 1956 when a converted World War II tanker was loaded with containers McLean’s innovative concept spread across the maritime world within a few years. It revolutionized maritime transport, ship designs, port cargo handling methods and simplified exporter’s packing and even documentation.

Today the world can survive without TV, aircrafts are useful but not essential, 40 years ago most businesses functioned well without computers, but close the Suez and Panama canals and take away container ships the global economic collapse will be inevitable and far worse than the prevailing credit crisis. The impact of the two canals and containerization on international trade highlight how speedily/ positively rational revolutionary changes could affect the global economy beyond expectations.

Against this backdrop, I could now safely predict, that the third revolutionary change in shipping and trade will occur with the construction of the world’s third shipping canal across the Kra Isthmus of Thailand before long. Evidence to support this prediction was given in my previous article under the heading "A tale of Two Canals"  (Sunday Island 26.10.2008). To that list I need to add the prevailing threat from the Somali pirates to the Asia –Europe shipping services and international trade. That threat from a band of rag tag pirates in the open seas is on the one hand a moral booster to the pirates who have been operating in the narrow straits of Malacca and on the other an SOS call to China, Japan, S. Korea and other Pacific countries in particular and to the operators of international shipping services.

An effective revival of the Kra canal project is inevitable on that score alone. The only temporary set back could be the prevailing political upheavals in Thailand. Incidentally our navy commander, Vice Admiral Karanagoda in his memorable speech delivered in London a few months ago at a meeting of the Naval chiefs of the maritime world, warned that the sea route from the Persian Gulf to the Suez so vital to both oil producing and consuming countries of the West, was most vulnerable and a likely target for attacks besides the Malacca straits so important for China and Japan for their oil supplies.  His warning was ignored and today the Western Countries and Saudi Arabia are paying millions of dollars to the pirates who may earn enough dollars to bail out some crumbling corporate bodies in the west. No doubt the pirates in the Malacca straits must be dreaming and planning to join the millionaires club.

In 2005, an internal Pentagon report prepared for US Secretary of Defence Donald Rumpsfeld leaked to the Washington Times, spelling out China’s strategy of underwriting construction of the canal across the Kra Isthmus complete with Chinese Port facilities and refineries as part of its "string of pearls" strategy of bases and energy security. The Chinese plan called for construction over 10 years employing roughly 30,000 workers and costing between USD20-25 billion.

Somali piracy underscores the insecurity of the Malacca straits for shipping, the need to reduce the cost –distance and time for shipping services through the proposed Kra canal. Above all the not so secret US-India strategy to block the Malacca Straits in the event of a war with China, are trump cards the Kra canal promoters could use to induce China to cut the canal.

Further, the Kra canal could be a major boost to Asia’s trade with the world in Asia’s century – the 21st !

Sri Lanka which is on the new sea route half way between Europe and Asia could be a principal beneficiary of the Kra canal. However to reap the benefits a great deal of preparatory work has to be done beginning from now. So far China, Japan, USA, Singapore, Malaysia are monitoring the progress of the Kra Canal Project – but not Sri Lanka

As a first step our Embassies in Bangkok and Beijing have to monitor and report on the progress of the Kra Project to an appropriate authority in Sri Lanka –ideally an inter ministerial unit should be established for this purpose.

Secondly the government through appropriate diplomatic channels should convey to both Thailand and China as well as Japan our support for the project. Even a token participation in equity and offer of the services of our highly talented engineers and experts could be helpful.

Thirdly – Singapore the World’s number one transshipment hub and the Dubai Port (born as late as 1991, to become the number one port in the Middle East) are two role models for Sri Lanka to follow in its preparatory work to meet the challenges and take over the mantle of Singapore’s position in shipping after the Kra canal. Hence a study of the road to success by Singapore and Dubai is a sine qua non in our preparations.

Fourthly, Ministries of Ports and Aviation, Defence and Foreign Affairs through an inter –ministerial unit should monitor the Kra Project developments, organize seminars, and study groups with private sector participation to promote public awareness, besides studying potential geo political factors of strategic significance to achieve regional trade friendly and stable security environment in S. Asia and the Pacific region. The Kra Project in fact could be the initiative to marry ASEAN and SAARC.

Fifthly,  with inputs from the studies of Singapore and Dubai Port Development and other port developments and studies draw up a master plan for both Hambantota and Trincomalee Ports to reap the beneficial fallouts from the Kra Canal. The Trincomalee Port is almost right opposite the Kra Canal and has the potential to be the entire region’s repair hub initially and ship building centre for the labour intensive industry in the future.

Mangala Yapa Managing Director of Colombo Dockyard, the pragmatic visionary whom I consulted made a revolutionary prediction or perhaps a forecast. He said "as container vessels increase in size to 12,000- 18,000 TEUs while bunker and other operating costs increase, mega carriers currently serving a large number of ports in the Far East (Hong Kong, Shanghai, Yokohama, Kaoshung etc) carrying less than ship loads of containers will be induced to terminate their East –West voyages in a port like Hambantota and arrange feeder services to operate from Hambantota to the Far East ports using the 4000-6000 TEU vessels which will become obsolete but are too young to be scrapped.

Hambantota port could then become not only the world’s number one transshipment port but also the centre for the distribution of cargo from East Africa to the Far East including Australia and N. Zealand.

Another shipping expert I consulted is convinced that either Trinco or Hambantota or even both are ideally located to become the oil hub for the region between the Middle East and the Pacific region. Both China and Japan which consume 19% of the World’s oil supplies need such an oil hub for both economic and security reasons. Currently Singapore with a storage capacity of 34 million barrels provide this logistical convenience to Asia – Pacific region from Jurong Island. Recently S.Korea following the example of Singapore launched in October 2008 a similar oil hub with 6m barrels of capacity to serve the N.East Pacific region. The capacity is to be increased to 28m barrels with an investment of USD320m by the participants of the joint venture between oil companies and S. Korean National oil corporation.

To some even the suggestion to prepare for the post Kra canal project may sound visionary. As McLean and De Lesseps proved, rationalization, cost reductions and facilitation of international trade could convert visions to reality within a short period. In the evolving developments surrounding the Kra project and the need to pick the opportunities it would throw, there can be nothing called over-preparedness. Perhaps Singapore’s responses to the impending threat to its prosperity is a clear signal that the canal will become a reality. Those responses alone underscores the need for Sri Lanka to begin our preparations. If we are not ready our station will be by passed to reach Dubai.

Following are some excerpts from the foreign media on Singapore’s plight and response:

"Time and again over the last three centuries the Kra Canal vision has surfaced along with the dire economic threat to Singapore. Now the reality of a Kra Canal is fast taking shape"

"Thailand has much to gain from the Kra canal project. Singapore has just as much to lose"

"The Kra canal which will divert shipping calling at Singapore to Thailand will have an impact on Singapore’s economy which will be huge and permanent"

"China badly needs imported oil to fuel its growth and its leaders are seriously looking at the Kra canal project as an alternative to the Malacca straits. A large oil tanker sunk at the very narrow Phillips Channel in the Malacca straits could hold oil imports to China and Japan for several weeks"

"the Kra canal will allow vessels on the Asia Europe route to by pass Singapore and cut the voyages by at least 1000 km."

"The Kra canal could pose a bigger threat to Singapore than the loss of manufacturing jobs. Singapore despite the publicity it has reaped from its high tech reputation, has in fact always relied on its position as Asia’s top transshipment point for its prosperity"

"Beijing controlled Economy Magazine in June 2003 stated that it would be in China’s interest to invest the billions of dollars needed to cut the Kra Canal to reduce its dependency on the Straits of Malacca – the choke point. Many in Singapore have long described that the Kra project is a pipe dream – but they could be wrong."

"Former Deputy Prime Minister of Thailand sent at least three delegations to China to persuade the Chinese to invest in the Kra Project. "What is Singapore doing to counter the threat ? while some Singaporean commentators have played down the threat, the Leaders are not taking chances" "Singapore is now actively playing its Thai and China cards in the hope perhaps that if the Kra Project does take off it will at least be in a position to be involved in it. Given the circumstances this is really all that Singapore can do." (Channel News Asia)."