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Monday, 21 January 2013

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Exporters back $ 20 bn goal by 2020

Sri Lanka’s exporters have lauded the government for its 2013 budget and have openly and actively thrown their full weight behind the national export goal of $ 20 billion by 2020.

Meanwhile an international management consultancy firm termed Sri Lanka’s recent linking-up with UK’s Tesco ‘a good hit’. “We thank the treasury and the government for giving us an exporter friendly budget 2013 with several relief measures granted to exporters.

So now it is for exporters to take these relief measures forward and achieve the government’s target of $ 20 bn by 2020” said Dr.Jagath Peiris, President of National Chamber of Exporters of Sri Lanka. Dr Peiris was addressing the 18th Annual General Meeting of National Chamber of Exporters at the Grand Ball Room Hilton Hotel.


Anura Siriwardene ,Secretary, Ministry of Industry and Commerce addressing the 18th Annual General Meeting of National Chamber of Exporters at Grand Ball Room of Hilton Hotel recently. Dr.Jagath Peiris, President of National Chamber of Exporters of Sri Lanka was also present.

The NCE’s AGM saw the presence of top NCE member firms that are responsible for almost 50% of exports originating from Sri Lanka annually. “2012 has been a challenging year. We knew it was going to be challenging.

The labour costs went up, minimum wages rose by 30%. Energy costs too went up by 30-40%.

We, the exporters suffered due to that. Our input costs are high. Cost leadership strategy is not going to work anymore.

It has shifted from Sri Lanka to other countries. New strategies need to be explored. Best strategy would be by differentiation through value addition, better service provision, better packaging etc. We need to differentiate each and every one of our products, for us to take our exports to the next level.

Innovation is how we could achieve this. We thank the treasury and the government for giving us an exporter friendly budget 2013 with several relief measures granted to exporters.

One such relief is the triple deduction for research expenditure on required equipment and development of laboratory facilities to encourage private sector engagement in research and innovation. We also praise tax exemptions for certain imports related to solar energy.

Our requests to protect several local industries through cess, have also been addressed in the Budget 2013. So it is for us to take these measures forward and achieve the government’s ambitious target of $ 20 bn by 2020,” said NCE President (for second time) Dr Peiris, “We have appointed six trade representatives in Canada, South Africa, Dubai, Australia, Saudi Arabia, UK, and USA who provides us with (latest) market information. We are also entering into an agreement with the National Science Foundation so that we get facilities for exports innovation, research and development. We believe that we can form the Institute of Exports to give professionalism to exports sector. The institute is expected to be formed based on guidelines and syllabus of similar institutes in UK, Malaysia, India, Singapore and Australia,” he added.

Anura Siriwardene, Secretary, Ministry of Industry and Commerce) addressing the session stressed that despite concerted efforts by Sri Lanka’s export sector, the crisis in West has affected the country’s exports. “Export growth has indeed been satisfactory during 2011 and 2012, mainly due to the pragmatic programmes and policies adopted by the government and also due to the resilience shown by the private sector despite numerous adversities. The crisis aggravated in 2012, in the developed countries, specially the West and USA, which absorb 55 % of our exports. This has adversely affected our exports,” said Secretary Siriwardene.

“The slowdown is not confined to Sri Lanka alone. Exports from India and Thailand also slowed down during the recent past. It is of utmost importance today to turn around the exports sector if we are to achieve our exports goal. It is observed that Asian countries have shown substantial economic growth and India and China are expected to show strong positive growth in 2013 and 2014. Therefore the potential in these markets are very high and we are concentrating on diversifying our markets into BRICS and other emerging markets.

“I stress that the involvement of NCE is very important to collectively confront the challenges faced by our exports sector. We strongly believe that the private sector is the engine of growth. The private public partnership is the key to achieve success in export development programmes,” Siriwardene said.

“Sri Lanka paid a very high price to go for multilateralism. Unfortunately, it did not work the same way we thought of. Thereafter many countries started to go back to protectionism slowly,” said P D Fernando, Director General of Commerce addressing the event. “Today this is a big problem. WTO-Doha rounds could not go ahead. Many countries wanted other countries to liberalise their trade. Lately, everyone is talking of export led growth. So who is really left to import?” asked Fernando.

“I applaud the recent move by the Department of Commerce by successfully getting Tesco to Sri Lanka. These are the master strokes that we need to play if we are to achieve our $ 20 bn exports,” said Hilmy Cader, CEO, MTI Consulting, which is a Colombo based international management consultancy. Cader thereafter outlined his export prescription through a series of thought provoking queries.

“We have to start by critiquing ourselves as to how successful we have been in our exports against our competitors. How can we offer a value proposition to international markets? How do we make more of our companies multinationals? Is our real definition of exports mean only tangibles? I think services need to be given a bigger place in our exports. Having done that how do we finally make those numbers work? We need to have a clearer focus on who is enabling what, a clear mapping? The other important question is what are we good as a country? Are we good in manufacturing or services?

Because that finding in turn will determine what we will finally export. Is the current crop of Sri Lankan exporters are going to take us to $ 20 Bn by 2020 or are they very comfortable in $ 10 Bn range? In some of our export sectors, I really don’t see them having such a drive. Export goals will come only if you have export entrepreneurs with real drive to make a mark in the global market. And that is where companies like Brandix excelled and have become world class companies.

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