Sri Lanka moves to modernize plastic sector with US $ 1.75 m

Sets 40% growth target:

Sri Lanka’s plastic industry will get a new boost when the Industry Ministry and UNIDO will soon launch a national initiative to upgrade it. “As our per capita plastic consumption is set to increase from current 6 Kg to 8 Kg and plastic has become an indispensable item in our lives and manufacturing, I believe this is the right time to strengthen this sector and we are launching a new national initiative with UNIDO which aims to increase production and income volumes by almost 40%” said Rishad Bathiudeen, Minister of Industry and Commerce recently.

Minister Bathiudeen announced this in the aftermath of an in-depth discussion and presentation to the Minister by the visiting International Centre for Advancement of Manufacturing Technology (ICAMT) delegation recently at the Ministry of Industry and Commerce. The ICAMT is the ISO 9001:2008 certified International Technology Centre operated by UNIDO and located in Bangalore, India. The ICAMT delegation was meeting Minister Bathiudeen as part of Colombo UNIDO’s initiative to upgrade and modernize Sri Lanka’s plastic industry technology.

“The initial project value is $ 1.75 million and we want to go into a detailed assessment of our plastic sector before commencing the modernization assistance,” revealed Nawaz Rajabdeen, UNIDO National Director for Sri Lanka who is facilitating the new initiative.

According to UNIDO, annual plastics consumption in Sri Lanka is close to 140,000 metric tonnes, with an estimated growth rate of 10-12%. More than 900 businesses in Sri Lanka are engaged in plastics processing for both domestic and international market, the bulk of them being in SME scale. 440 companies are engaged in direct plastic exports in 2009 with 88% of them being finished products exporters and rest 12% are raw materials and waste exporters.

Among the finished products exports, 60% were packaging materials / packaging goods of plastics. Cellulose and its chemical derivatives constitute the highest export value among the primary forms of plastic exports taking 6% of the total plastic exports in 2009. USA is the dominant buyer of plastic exports over the last number of years taking 40% of the total exports.

Revealing more details of the initiative, Minister Bathiudeen said, “Plastic industry holds high potential for Sri Lanka’s rural sector. This initiative will address modernization, employment, productivity, production quality as well as export growth. Therefore, it has a wider reach. It will also help us to reach the producers, most of whom are SMEs deserving support. I thank UNIDO for this timely intervention.”

Programme Director-ICAMT, Mahendra Singh Dhakad, making his presentation said, “The objective of the national level project is to enhance the competitive position of the plastics industry in Sri Lanka through technology modernization, skill enhancement, quality improvement and market development. The proposed action plan is multidimensional since the modernization of production processes will also help employment, quality and export growth, ISO facilitation and quality management systems and in general, an industry wide upgrade.

It aims to increase plastic production and income volumes by almost 40% and 30% increase in plastic exports. 300 specialists will be trained on Best Manufacturing Practices and Quality Management Systems.

“We will not only focus on general aspects of the plastic industry such as export growth but are aiming to go to baseline data such as the number of training man days and percentage of increase in unit level productivity in this project.

“We see opportunities in the sector for example expected growth in demand of color, additive, filler and functional master-batches, increase in demand of PVC pipes due to introduction of plastics in water management, drip irrigation and as well as growing consumption due to presence of allied industries like tea, rubber,” minister Bathiudeen said.