Exports heading in the right direction - EDB
The country’s exports are heading in the right direction with apparel, coconut and coconut based products, recording an all time high in May, according to the data released by the Export Development Board (EDB) last week.
Apparel exports reached an eight-year high, recording US $ 423 million compared to US $ 397 million in 2018. The coconut and coconut based products reached US $ 57 million compared to US $ 48 million in 2018. The total exports stands at US $ 8.5 billion. Total exports for 2018 were US $ 18.5 billion recording a 33 percent volume growth over the last three years.
Total exports for the first half grew by 11.4 percent while merchandise and services exports recorded 6 percent and 26.9 percent growth.
The government has placed a lot of emphasis on improving exports and quality of investments. We need to increase both these substantially to get out of the debt trap as we can not go on borrowing to pay debt, Minister of Development Strategies and International Trade, Malik Samarawickrama said at a media interaction session at the EDB last week. The export sector is witnessing a revival in growth with an ambitious target of achieving US $ 20 billion by the end of 2019. For the first time, over US$ one billion monthly merchandise export earnings were recorded in three months during the first half of 2019, January (US$ 1,030 mn), March (US$ 1,137 mn) and June (US$ 1,099.3 mn), he said.
“Liberal market oriented policies implemented by the Government will accelerate the development process, and open new vistas, for investment and business opportunities in the country despite the several setbacks faced since the last quarter of 2018. The export sector of Sri Lanka contributes 18% to the Gross Domestic Product (GDP) of the country,” the Minister said.
“The broadening and deepening of the current FTAs and the new FTAs with developing Asian nations, will enable access to a market of more than US $ 3 billion. These FTAs can increase Sri Lanka’s competitiveness in industrial exports and also increase her supply capacity to better use the market access. These initiatives must be strongly supported by the Sri Lankan private sector,” he said.
“I must mention the contribution made by the export services sector with a growth rate of 27% to reach US $ 2,512 million during the first half of 2019 from US $ 1,980 million during the corresponding period in 2018. Measures have been initiated to establish Sri Lanka’s participation in the Global Value Chains with a focus of creating a global center of excellence in high-end product engineering. The EDB is working closely with the industry and has identified potential manufacturers to ensure the sustainable production capacities in Sri Lanka. The industry has engaged in parts and component manufacturing for the export industry, such as automobile components, circuit boards, office equipment and electrical machinery,” he said.
Referring to export performances of other countries, the Minister said that Vietnam has a drive for exports with a total of US $ 270 billion as against Sri Lanka’s US $ 18 billion. “We need to integrate with the world with the use of modern technology. We have to look at export oriented manufacturing. This year, exports have reached 20 percent of the GDP, but we need to further move up.”
The Government is also reviewing the ecosystem in doing business in Sri Lanka to facilitate local entrepreneurship through the implementation of the Ease of Doing Business, National Export Strategy and the Export Market Access program.
Proposals included and announced in the National Budget 2018 and 2019 are being implemented for the development of the export sector. “My Ministry together with the EDB and BOI are working closely with the industry on these Budget proposals on developing export sectors while addressing bottlenecks faced by exporters. The ultimate objective is to increase country’s exports to US $ 28 billion by 2022.”
NES for Sri Lanka 2018-2022 was formulated under the guidance of my Ministry with other Government and private sector stakeholders with financial support from European Union (EU) and technical assistance from the International Trade Centre (ITC), Geneva. Novel globally competitive strategies were developed based on inclusive and extensive consultations with more than 600 public and private stakeholders focusing on a vision of “Sri Lanka – An Export Hub driven by Innovation and Investment”.
“I’m happy that several committees set up with Public - Private Partnership under NES are moving towards swift implementation of the priority actions since the launch in June 2018. Strong performance is evident in some of the ‘focus sectors’ identified under the National Export Strategy; notably, food and beverages, boat building and ICT/BPM during the first half of 2019.
“It is important to have a change of mindset in bureaucrats and politicians while the exporters move away from protectionism and be more competitive. To this end, we have to assist them to improve productivity and efficiency,” he said.
The target set for 2019 is to achieve US $ 20 billion exports which I’m confident with the public and private collaboration and strong commitment is possible, he said.
“We have to concentrate on building our own manufacturing base and producing high-end value added products. We have public- private partnership mode to engage in dialogue with exporters. This is a positive move to increase exports,” Chairperson and CEO EDB Indira Malwatte said.
“There are issues due to delay in implementation of the National Single Window facility which is a wider platform in the export value chain. The exporters are losing confidence due to delay in implementation mainly due to technical issues.
“They are also keen to know how the fund accumulated through port and airport levy is being used,” Secretary General/CEO National Chamber of Exporters of Sri Lanka, Shiham Marikar said.
“There is speculation that a charge be put on shippers. This will adversely affect the operational cost of the exporter. We urge the authorities to ease the burden of the exporters. We also request the government to create a solid platform and policies for the exporters to compete amidst natural and man made disasters, such as strikes and droughts,” he said.
by Sanjeevi JayasuriyaSource at: Sunday Observer