BoI needs one stop shop concept

Hiran H. SENEWIRATNE

The Government has to play a catalystic role for the private sector to drive the economy to a stable position, Managing Director/General Manager CIC Paints (Pvt) Limited Gerald De Saram said.

He said today all have become politicised and this has affected the private sector in their way towards growth despite the crisis situation in the country. Therefore, the Government should act impartially as a facilitator for economic growth of the country.

De Saram said the Board of Investment (BoI) is a classic example. It does not really promote economic development due to the absence of a one stop shop concept to set up business entities.

“Due to the current impediments approvals to start off a business needs be taken from various local govenrment entities,” he said. He said the Government should set up institutions to evaluate projects and approve projects of private sector entities through the one-stop-shop method without politicising and be involved to achieve rapid economic growth.

“The Government also should set up institutions, which focus on benchmarks free from politics for the purpose of evaluating business entities to become world class business organisations”, he said.

Q: What is your opinion on the recent acquisition of your parent company ICI by AkzoNobel. Any change in the corporate identity in the company in the future?

AkzoNobel is a Netherlands company that has entered Sri Lanka and has significantly strengthened its presence in emerging Asia Pacific markets, after the recent acquisition of our parent company the British based chemical multinational Imperial Chemical Industries Plc (ICI).

CIC Paints an associate of Chemical Industries (Colombo) Ltd, was until the point of the acquisition part of ICI Paints plc, the global leader in decorative paints and owners of the household brand for premium quality paint, Dulux.

The management control of CIC Paints Ltd will now shift to AkzoNobel. AkzoNobel is an organisation reputed for its commitment to research and development and offers a diverse portfolio of products such as wood, marine and high performance coating that will complement the current range of Dulux and Glidden paints.

Q: With the new acquisition by AkzoNobel, what plans for Sri Lanka?

AkzoNobel is a Fortune 500 company and is listed on the Euronext Amsterdam stock exchange. The company is also the chemical industry leader on the Dow Jones sustainability indexes. With these development AkzoNobel will invest on a long term perspective.

They have noticed that the Sri Lanka market is vibrant and viable as we have achieved a growth despite the turbulent situation. Therefore, CIC will change in future in keeping with the AkzoNobel identity.

Q: What is the organisational structure of the company. Will there be any changes with the new acquisition?

Well! Firstly I must tell how our organisation came to be. CIC has invested to CIC Paints along with ICI. By virtue of shareholding and voting rights ICI retains operational control of the business.

CIC is a now passive partner with two directors in the Board while ICI UK has three directors. I am reporting to the ICI. The acquisition of ICI by AkzoNobel will change the corporate identity to keep it in line with the new company in the future.

Brands like Duco, Dulux and Pentalite will not change. But new acquisition will mainly be on technical transfer and introduction of new product and brand portfolios.

Q: The paint business is a highly competitive business in Sri Lanka. What is the current business environment for the paint business?

The competition is good and makes the business more vibrant and active, which is healthy for the sector. We have to welcome healthy competition, which will also help us to be more vibrant and active in the business. Luckily we don’t have any problem with cheap imports or dumping.

Q: How would you see the local construction industry fairing?

Currently a lot of infrastructure projects are in the pipeline, which hardly use paint. That does not have a major impact to the sector. However, our local construction sector is showing a decline during the last few years. This adversely impacts the paint industry. Today, the market is depressed with the current economic condition.

Due to the current economic depression banks are not giving credit for dealers which has resulted our margins eroding.

Q: How will the global changes impact the paint industry?

As we know 90 per cent of our raw materials are imported. Escalating of prices has a huge impact towards the business. Dollar prices have gone and this affects the local prices as well. The role of the Government is to mitigate the compounding effect.

Q: What is the market share that your company holds at present in this highly competitive business?

The information on the paint market in Sri Lanka is very poor. According to our guess we are commanding a 40 per cent market share in the business but that figure is not absolutely proven. We are in that position because we sell products that are value for money and our consumers are educated and sophisticated on paint products.

Q: Sri Lanka is grappling with a lot of problems. As a business leader what are the solutions you suggest to the decision-makers in the country?

Firstly we have to stop the war with a durable solution. We have to be genuine in solving the problem without having any political expediency. Once the war stops we have to address the deep-rooted issues like bribery, corruption and waste. The other important matter is to restore law and order in the country.

Q: What is your philosophy in life?

The philosophy that I practise is what my father taught me which is work hard and play hard. As a businessman we are fortunate to help needy people with our resources with us which I am doing now. I took the initiative to form the Dulux Child Protection Trust Fund to help children in the country as a CSR project of the company.

Q: What is your retirement plan in the future?

I am now 48 years. Still more to go. Once I retire I would like to go and live at Kalametiya where I have a property next to the Kalametiya sanctuary close to Yala. I will go there and spend my retirement with nature. I am now growing indigenous trees that attract birds in to my property.

Profile

Name: Gerald De Saram

School attended: S. Thomas’ College, Mt. Lavinia and Brighton College London (UK)

Qualification:

Academic: Bachelor of Science, University of London

Professional: Diploma in Marketing (CIM-UK)

Civil status: Married has two children

Current position: Managing Director /General Manager CIC Paints (Pvt) Ltd.