‘Govt taking steps to safeguard exports’

Sri Lanka exports will not remain passive in the face of global downturn, said Risad Bathiudeen, Minister of Industry and Commerce. “We are not going to remain passive at a time when our export markets around the world turn more challenging due to the decline in leading segments and the downward revision of GDP projections for India and China. We are under no illusions that our exports will continue to be easy as the markets become increasingly difficult.

In fact, we are taking active steps to safeguard our exports,” he said. Minister Bathiudeen was addressing the launch event of the UNIDO backed, Spice Council promoted $1.53 million national project “Enhancing the Compliance and Productive Capacities and Competitiveness of the Cinnamon Value Chains in Sri Lanka” on October 23 at the Galle Face Hotel, Colombo.

I am now pleased to announce that as a result of these consultations during the last few months, we are now on a new initiative of setting up a Consultative Committee on Market Diversification representing the interests of a wider cross section of the economy.

Also for the first time we held direct consultations with our leading exporters last September to find solutions to their issues and received very good responses. We also revived our exporters’ forum and the third forum in the series was successfully concluded in July. But more importantly, as part of moving from simple exports to more complex products, we are looking at actively joining Regional Production Networks so that our exports become more market driven.”

Minister Bathiudeen also said Sri Lanka as having opened six new markets for its global exports monopoly-Pure Ceylon Cinnamon. “As a result of EDB’s market diversification efforts, in 2011 we successfully added six new countries to the list of Pure Ceylon cinnamon destinations. The new destinations are Guam, Monaco, the Russian federation, Mongolia, Brazil, and Georgia. What is interesting about the newcomer Guam is that it immediately entered the 11nth rank, among importers of Pure Ceylon Cinnamon in 2011” Minister Bathiudeen said and added: “Sri Lanka contributes to over 70 percent of world’s production of real cinnamon, and our own Pure Ceylon Cinnamon brand, is meeting more than 80 percent of the real cinnamon demand in global markets.

In fact,Mexico has been the number one buyer, of our cinnamon, for some time. We have realised that, the cheap substitute called as cassia, has become a growing threat, to our cinnamon in international markets. I believe that today’s initiative, which is valued at US dollars 1.5 Million, will be a right step, towards securing our cinnamon status, in the global marketplace, since upgrading the quality of our human resources, is an essential step, to enhance our value chains, and achieve better cinnamon exports.

It is essential that we secure our dominant position, in Sri Lanka’s cinnamon exports and even enhance other exports too, if we are to achieve $ 15 billion by 2015. I am given to understand that the value of today’s initiative is US dollars 1.5 million.

I am thankful to the World Trade Organisation and the Treasury for meeting almost one million dollars in funding, the rest being funded by UNIDO. Sarada de Silva, Chairman of the Spice Council said: “Over 700,000 farmers are involved in our spice industry. As a result of cinnamon price increase, around 350,000 involved in the sector have benefitted. We support the government’s cess on bulk exports since we want more value addition taking place. It is the Spice Council that proposed this cess.”

Ayumi Fujino, Representative and Regional Director, UNIDO addressing the event expressed her surprise about Sri Lanka’s cinnamon strength.

“I was not aware that Sri Lanka has 90 % share of international markets for true cinnamon. Under our trade capacity building thematic, UNIDO is pleased to assist Sri Lanka Cinnamon value chain initiative” said Fujino.