Perspective

Positives: New strategies, new markets

Geoff Wijesinghe

The current global recession is a golden opportunity for small countries such as ours blessed with an abundance of natural resources to evolve new strategies and penetrate new markets.

Unlike the major economies, for example the United States which is paying a heavy price for a false sense of complacency, resulting in heavy over borrowing, the Sri Lankan economy has managed to “cut its coat according to its cloth”. Considering the fact that we are relentlessly battling terrorism amidst a global recession our economy is in reasonably fair shape.

The Americans are paying dearly for an absolutely irresponsible spending spree borrowing massive amounts, but not having the money to repay the loans. The US financial crisis has had a dominoes effect sending countries throughout the world reeling.

According to a Newsweek report, personal savings in the US dropped from 11 per cent in 1982 to almost zero by 2005.

The present crisis, though usually attributed to dubious ‘sub prime’ mortgages, traces its origins in the widespread optimism unleashed by disinflation.

By 2006, household debt was 134 per cent of personal income.

It is very opportune that the recently announced budget introduced a number of welcome measures to curb foreign exchange expenditure on imports we can do well without.

This belt tightening is absolutely necessary to curb a growing imbalance between import and export expenditures.

On the other hand, the budget has allocated large funds for industrial development.

Time was when this country was known as the ‘granary of the east’. The budget has placed prime importance for paddy production.

Particular emphasis has been made and strong support given for agro industries. Apart from our traditional exports of tea, rubber and coconut, high priority and incentives have been given for the development and export of fruits and vegetables.

Our fruits and vegetables have good demand abroad, but facilities for exports such as efficient cold storage facilities both at the farm gate point of collection and through refrigeration facilities at the Katunayake Airport and speedy air transportation direct to markets are essential factors.

In addition to agricultural exports, new strategies and new markets must be looked at and penetrated for tourism and the export of leatherwear, textiles, confectionery, household equipment such as refrigerators and ceramic ware, handicrafts, salt and many other products. We must take confidence in the fact that all these are proven to be up to the best international standards.

Looked at positively, there is always a silver lining in a seemingly dark cloud.