ON A ROLL: GSP FOR TEN YEARS

EU, Lanka annual trade volume exceeds US$ 5 b

Daily News - 04/01/2014
By Chaminda Perera

Sri Lanka will continue to receive the benefit of the European Union (EU) GSP facility for another 10 years beginning from January this year, Industry and Commerce Minister Rishard Bathiudeen said yesterday.

He said the EU has been Sri Lanka’s largest trade partner next to the United States and the bilateral trade volume exceeds US $ 5 billion a year.

“Total trade between Sri Lanka and EU which was at US $ 3 billion in 2004 rose to US $ 4,946.18 million in 2012. Apparel, diamonds, tea and rubber products became the major export items,” he said.

The minister added that more than 87 countries have lost the EU GSP facility from this year with the activation of the new GSP Scheme approved by the European Parliament in June last year effective from January 1 , 2014.

“The number of countries that enjoyed this facility up to the end of 2013 has been reduced from 177 to 90 with the activation of the new GSP scheme,” he said.

The minister added that 20 countries that have achieved high and upper middle income levels will not receive preferential access to the EU market from this year.

Minister Bathiudeen said that EU is 500 million strong economy that holds a promise “The EU is also one of the most diversified investors in Sri Lanka, with leading European companies operating in almost all sectors of economy-specially, Fast Moving Consumer Goods (FMCGs), higher education, apparel, infrastructure, manufacturing, agro, technology and even in strategic development projects,” he said.

The minister added that there is an increase in terms of trade and balance of trade between Sri Lanka and European Union.

EU multinationals as Unilever and British American Tobacco are well established in Sri Lankan with their decades-long Fast Moving Consumer Goods (FMCGs).

‘Seven firms now in automotive assembly here’- Minister Rishad

news.lk - 02/01/2014

Export cess on rare earth/mineral sand were introduced to safeguard our industries –and no less than seven firms are now active in automotive assembly industry in Sri Lanka. “To safeguard domestic industries and to ensure a continuous supply of raw materials for local industries, we introduced exports cess on selected items.  And seven companies have ventured into the automobile assembly industry with a local value addition exceeding 30%” said Rishad Bathiudeen, Minister of Industry and Commerce on 10 December.

Minister Bathiudeen was making his Ministry’s Budget Statement on 10 December at Parliament, which was tabled by him.

Elaborating on the introduction of measures to safeguard domestic industries and on local automotive assembly, Minister Bathiudeen said: “Taking into consideration the requests made by the Division on behalf of industrialists, the Cess on several items was increased / imposed such as, fresh, preserved, dried vegetables and fruits/ other vegetable and fruit products (to protect the local processed food industry), edible oils, margarine, sausage or preserved meat products, honey & jaggery, confectionaries, bakery products, food preparations, mineral water, vinegar, salt, among others. In order to safeguard domestic industries to ensure a continuous supply of raw materials for local industries and to encourage the export of value added goods by discouraging the export of items in raw form, the Cess on Cinnamon, cloves, natural sands, quartz, clay, phosphate stones (emery, corundum), stones (gravel, pebbles etc.), mica, steatite, ilmanite, rutile, Titanium, Zirconium, Niobium, Tantalum, Vanadium etc. was increased, to facilitate domestic industries. Also exempted from the payment of excise duty on Locally assembled / manufactured motor vehicles and electrical items that come under the HS headings 84 and 85, which achieve a Local Value Addition (LVA) of above 30%.  From the time that the first batch of vehicles was granted the duty exemption in 2008, seven companies have ventured into the automobile assembly industry with 17 models of vehicles being assembled by the seven local companies totalling to over 6,000 vehicles with a LVA exceeding 30%.”

 Addressing the House on his Ministry’s utilization rates, Minister Bathiudeen said: “I am pleased to say that our actual recurrent expenditure up to 30th September 2013, stood at Rs 374.92 Million, which is a utilization rate of 66%. Our capital expenditure up to 30th September 2013, stood at Rs 518.6 Million, which is a utilization rate of 31%.  The grand total actual expenditure of both recurrent and capital are Rs 893.5 Million up to 30th September 2013.


These funds were fruitfully utilized by my Ministry’s committed divisions, departments, funds and projects -among them are, the Industrial Policy & Development Division, Regional Industrial Development Division, Development Divisions  1, 2,and 3, the Productivity Improvement, Industry Registration and Management Information Division, National Authority for the Implementation of Chemical Weapons Convention, Corporations & Statutory Boards Division and organisations under it, Small and Micro Industries Leader and Entrepreneur Promotion Project III Revolving Fund (SMILE III Revolving Fund), Textile Industry Development Division, Department of Textile Industries (DTI), the Department of Commerce (DOC), Department of Registrar of Companies, National Intellectual Property Office, and the Sri Lanka Export Development Board.

Sri Lanka’s Garment Exports to EU, US Jumps 30% in Sept’13

The exports of garments from the island nation of Sri Lanka to its major export destinations of the EU and the US recorded a remarkable growth of 30.7 percent year-on-year and 32.2 percent year-on-year, respectively, in September 2013, according to a press release issued by the Central Bank of Sri Lanka.
The sharp growth in Sri Lankan apparel exports to the EU and the US reflect the recovery in those economies, the statement said.

Sri Lanka’s textiles and garment sector as a whole posted a significant growth of 27.7 percent year-on-year during the month to register US$ 386.9 million, according to the Central Bank data.
From January to September 2013, Sri Lanka’s total textiles and apparel exports stood at US$ 3.126 billion, showing a rise of 5.2 percent over exports of US$ 2.972 billion made during the corresponding period of last year.

In 2012, Sri Lanka exported textiles and apparels worth US$ 3.8 billion, and the country has set a target of achieving US$ 4.1 billion in textiles and garment exports this year.
Meanwhile, Sri Lanka’s textile and clothing imports are showing a declining trend. In September 2013, the country imported textile goods worth US$ 174 million, registering a decrease of 3.1 percent year-on-year.
During the first nine months of the current year, Sri Lanka’s textile and garment imports declined by 8.6 percent to US$ 1.502 billion compared to imports of US$ 1.644 billion made during the same period last year.

Last month, Central Bank’s Governor Ajith Nivard Cabraal said the apparel manufacturing sector in Sri Lanka may face a shortage of skilled labour within the next 2-3 years, due to the country’s anticipated transition into a middle-income country, and advised the country’s garment industry to prepare for the changes in the same way as it prepared for dealing with the discontinuation of the GSP Plus.

Source: Srilanka Apparel

Export earnings increase to record levels in October

Daily News - 04/12/2013

The external sector strengthened further with the trade deficit contracting sharply in October 2013,the Central Bank said yesterday. Earnings from exports increased to record levels, reflecting the ongoing recovery in the global economy, while expenditure on imports declined. The contraction of the trade deficit, higher inflows to the services account and an increase in private transfers contributed to reducing the current account deficit.

The favourable developments in the external sector together with higher inflows to the financial account, resulted in the Balance of Payments (BOP) recording an estimated surplus during the first ten months of 2013, compared to the deficit recorded during the corresponding period of 2012, the Central Bank said yesterday.

Earnings from exports in October 2013 reached US dollars 1,041 million, the highest ever monthly value recorded in the history of Sri Lanka's exports.

This growth was led by industrial exports followed by agricultural exports. Earnings from industrial exports in October 2013, which account for more than 74 per cent of total exports, increased by 34 per cent on a year-on year basis to US dollars 771 million mainly due to higher export of textiles and garments.

Earnings from textiles and garments exports grew by 46.8 per cent, year-on-year, to US dollars 436 million in October 2013, which was the highest monthly value of export of garment and textiles ever recorded. Exports of garments to both the EU and USA, which are Sri Lanka's major export destinations, recorded remarkable growth rates of 53.2 per cent and 43.4 per cent, respectively in October 2013, reflecting the recovery in those economies as well as seasonal demand.

Meanwhile, earnings from rubber product exports increased by 50.1 per cent, year-on-year, to US dollars 94 million in October 2013, the highest monthly value since August 2012, led by higher exports of rubber tyres.

All categories of industrial exports, except gems diamonds and jewellery, animal fodder and petroleum products grew in October 2013. Earnings from agricultural exports rose by 37.4 per cent, year-on-year, to US dollars 258 million in October 2013 mainly due to an increase in export earnings from tea followed by spices. Earnings from tea exports recorded a healthy growth of 26.6 per cent to US dollars 147 million in October 2013. This was the combined outcome of a 13.6 per cent increase in export volumes and an increase in the average export price of tea by 11.4 per cent. Earnings from the export of spices increased significantly by 79.9 per cent to US dollars 41 million led by pepper and cinnamon exports. Continuing the strong performance recorded since June 2013, the volume of both pepper and cinnamon exports increased substantially although prices of those commodities declined, year-on-year. However, in October 2013 rubber export earnings contracted by 29.0 per cent compared to October 2012, due to the continuing decline in both export volumes and prices, owing to low demand from major rubber consumers, such as China and Japan.

Expenditure on imports declined by 2.8 per cent to US dollars 1,535 million in October 2013, due to the significant decline in both intermediate and investment goods imports. Expenditure on intermediate goods imports declined by 7.8 per cent, year-on-year, to US dollars 897 million in October 2013 mainly due to the decline in the importation of fuel and textiles. Expenditure on the importation of petroleum products declined in October 2013 due to the availability of sufficient stocks from previous months. Despite the strong growth in export of textiles and garments, there has been a steady decline in imports of textile and textile articles, reflecting improved backward linkages and higher value addition in the garment industry. Lower import of diamonds and precious stones and metals, rubber and articles also contributed to the decline in intermediate goods imports. However, fertilizer imports increased sharply by 110.7 per cent year-on-year, to US dollars 27 million in October 2013, mainly due to the low base in the corresponding period in 2012 and to ensure availability of adequate stocks for the upcoming Maha season. In October 2013, import expenditure on investment goods declined by 6.8 per cent, year-on-year, to US dollars 351 million mainly due to the decline in machinery and equipment imports by 16.5 per cent and a decline in transport equipment imports by 11.0 per cent although building materials imports increased by 13.4 per cent. Meanwhile, expenditure on consumer goods imports recorded a 25.6 per cent growth, year-on-year, to US dollars 286 million in October 2013 with increases recorded in both food and non-food consumer goods categories. Vehicle imports, mainly contributed to the increase in consumer goods imports, recording a year-on-year increase of 150.7 per cent in October 2013. Dairy products, clothing and accessories, Oils and fats, medical and pharmaceuticals and household and furniture items also contributed to the increase in consumer goods imports.

Lanka exports jump in October

Asian Tribune - 24/11/2013

Top officials join Rishad Bathiudeen (Minister of Industry and Commerce) to review exports at the Ministry of Industry and Commerce.

Sri Lanka is hopeful as exports continue to surge with latest volumes showing a promising uptrend. “The export trend in September is continuing. The 3% exports increase in October is higher than expected” said a pleased Rishad Bathiudeen, Minister of Industry and Commerce on 22 November.

Minister Bathiudeen was acknowledging the latest export numbers for October 2013 indicated to him by his top officials on 22 November at the Ministry of Industry and Commerce.

Accordingly, the January-October 2013 exports turnover increased by 3.07% to $ 8379.93 Mn in comparison to Jan-October 2012’s $ 8130.20 Mn.

According to the provisional data provided by the EDB, apparels rose by a strong 9.39% to $ 3549.94 Mn, while Industrial products rose by 2.32% to $ 6139.64 Mn. Agricultural and tea increased strongly- Agro product exports rose by 8.63% to $ 2015.85 Mn while tea exports also rose by 8.96% to $ 1237.82 Mn.

Other export crops such as spices, vegetables, fruits joined the trend, rising overall by 42% to $ 430.01 Mn.

Even fisheries products has increased by 15.03% to $196.35 Mn!

$ 01 B int’l biz partnerships from Reflection

Asian Tribune - 22/11/2013

Sujatha Weerakoon (DG-EDB-second from left) and Bandula Egodage (Chairman-EDB) join Rishad Bathiudeen (Minister of Industry and Commerce-far left) and Basil Rajapaksa (Minister of Economic Development-second from right) on 16 November at Reflection of Sri Lanka, Battaramulla.

The biggest Lankan trade, tourism and investment exposition in history successfully concluded on Sunday 17 November at Battaramulla, with $ 01 Bn in international business partnerships. “The event appears to be a sell-out. There were more than 242000 visitors that included an unprecedented number of international buyers representing 66 countries -which led to 1428 serious buyer visits, 101 promising B2B meetings” said Rishad Bathiudeen, Minister of Industry and Commerce on 20 November in Colombo.

Minister Bathiudeen was speaking with his top officials including Anura Siriwardena, (Secretary, Ministry of Industry and Commerce), on 20 November acknowledging the final review of the progress of Reflection of Sri Lanka -the integrated tourism, trade, investment and SME exposition -inaugurated on 13 November in Battaramulla. Reflection of Sri Lanka was inaugurated by (HE) the President Mahinda Rajapaksa on 13 November evening in the presence of a large number of Lankan and international dignitaries as well as media.

The strategic thinking behind “Reflection of Sri Lanka” is to leverage the opportunities provided by CHOGM as a platform to illustrate Sri Lanka’s capacity to easily integrate with global value chains. ‘Reflection’ will also highlight the country’s logistic capabilities, high knowledge base, and its dedication to international compliance standards encasing trade, tourism and investment opportunities in them. This historic Sri Lanka brand push targets no less than the movers and shakers-the international decision & policy makers as well as investment influencers arriving for CHOGM. In fact, many top Lankan brands, vendors and products such as Pure Ceylon Tea (Dilmah, Basilur), IT/BPO (SLASSCOM, PWC), were in prominent display at the site.

This event is an inter-Ministry effort, co-organized by the Ministry of Economic Development, our Ministry the Ministry of Industry and Commerce and the EDB functioning under it, and is joined by Sri Lanka Tourism, and the Board of Investment.

According to the Reflection of Sri Lanka performance report, there were The 242,176 visitors included an unprecedented number of international buyers representing 66 countries -which led to 1428 serious buyer visits, 101 promising B2B meetings, 195 negotiations for business partnerships leading to 37 confirmed, positive outcomes in 11 sectors- while another 897 event participants were being served by a novel concept called specific Export Industry Seminars that took upon such timely topics as ‘How to Export Under FTAs’.

Of the 1428 serious buyers visiting the event, 566 were trade delegates (including foreign visitors), 247 were online registered buyers, 510 from Business Forum delegates and 105 were new registrants. 101 promising B2B meetings were concluded successfully. 195 negotiations for business partnerships took place of which 37 led to confirmed, positive outcomes in no less than 11 sectoral categories of which the leading categories were ‘diamond, gems and jewellery’ and ‘soft toys & accessories’. 897 participants were given the opportunity to take part in a novel concept called Export Industry Seminars which focused on timely and very specific themes such as aquaculture development, bilateral technology cooperation, greener coconut production and exporting under FTAs.

Of the international visitors from 66 countries, business and investment delegations from China (04 delegations), Italy (1), South Africa(1), UAE(1), Iran(1), met Hon Minister of Industry and Commerce Rishad Bathiudeen at the Reflection venue and were enlightened of the many pathways to partner with Sri Lanka.

The Chinese, Italian, and South African delegations were afforded special factory visits upon their requests by Reflection organisers. Among the many factories visited were tea, construction, paint, rubber, cables, seafood, and fruits & vegetable processing. 49 international journalists from Canada, Dubai, Belarus, Russia, Ukraine, U.K., France, Saudi Arabia, India, Philippines, U.A.E, Pakistan, Japan and China visited the exhibition covering the opening ceremony, took comprehensive walk-throughs of the site and met Hon. Minister Industry & Commerce, Secretary Ministry of Industry and Commerce, DG Commerce, EDB Chairman, DG and with EDB officials at a briefing on 14 November. Hon Minister of Economic Development Basil Rajapaksa too, personally briefed international Journalists from Japan, India, New Zealand, and Australia. This large scale event was an inter-Ministry effort, co-organized by the Ministry of Economic Development, the Ministry of Industry and Commerce and the EDB functioning under it, and is joined by Sri Lanka Tourism, the Board of Investment and the Gem and Jewellery Authority.

The success of the event illustrated by its visitor composition alone is strong proof of confidence of international trade, investment and business communities on Sri Lanka’s new growth towards an upper middle income market economy.

The mini-BoI one stop shop at the venue recorded almost 4500 inquiries of which about 500 were from international business visitors. “Our stall has been well attended from the start. We have sector specific BoI specialist attending every serious inquiry immediately” said Jagath De Silva (BoI Senior Deputy Director-Media & Publicity). “There were many investment inquiries and among them, four large-scale investment inquiries positively stand out. The Spanish BoI wants to bring a strong investment delegation to Colombo for automobiles, machinery tools, and light engineering, A Canadian inquiry for an automated car park in Colombo, Iranian investment inquiry on fertiliser plant, Chinese investor inquiry to set up a steel construction material supply plant in Hambanthota” added De Silva.

Also inside Reflection was an expo within an expo- the China Engineering and Technology Expo event by China International Contractors’ Association, (CHINCA)China Council for the Promotion of International Trade, Chinese government officials, officials of Chinese Embassy in Colombo, and China Machinery Engineering Corporation. The CMEC stall, spanning 1300 Sq Ft, showcases 50 Chinese enterprises-including many businesses across many sectors including engineering contractors and engineering equipment manufacturers too.

Taiwan Textile Fair begins on November 26

Daily News - 20/11/2013

The top textile companies from Taiwan will be showcasing their cutting edge, unique and high performance textile products at Taiwan Textile Fairs in South Asia 2013 at the Taj Samudra, Colombo, Sri Lanka on November 26 and 27, 2013.

Taiwan is one of the largest textile exporters in the world and the Taiwan textile industry is internationally renowned for its manufacturing excellence. Their superior quality yarn, innovative fabrics and textile products are now coming to Sri Lanka and will present their range of state-of-the-art textile products to Sri Lankan apparel manufacturers at the Taiwan Textile Fairs in South Asia 2013.

With Sri Lanka's textile and export industry growing again, the Taiwan Textile Fairs in South Asia 2013 is the perfect opportunity for Sri Lanka's apparel manufacturers to source superior, exclusive and unique fabrics and yarns that will add substantially to their product range while also introducing manufacturers to new product categories.

Sourcing the unique fabric and yarn from these Taiwan based companies will give a substantial competitive edge to Sri Lankan manufacturers while also fuelling their growth in the growing domestic as well as international export market. The Taiwan Textile Fairs in South Asia 2013 is the ideal business matching platform for Sri Lankan marketers, business buyers, partners, distribution channels and key decision makers.

Taiwan Textile Fairs in South Asia 2012 was very successful and Justine Cheng, Specialist of Marketing Development Department of the Taiwan Textile Federation said, "We were pleased with the response in 2012.

The number of buyers to our show confirmed the strong potential of Sri Lanka's apparel market. This year the Taiwan Textile Federation has organised a group of textile and accessory suppliers specialising in fashion, function and innovative eco-friendly products. These suppliers will not only provide you premium products, but also provide Sri Lankan exporters and manufacturers a full package with high quality control and long-term reliable service."

This is organized by the Bureau of Foreign Trade (BOFT) and Taiwan Textile Federation (TTF) with its representative agency Worldex India Exhibition and Promotion Pvt Ltd., the event is duly endorsed by the Sri Lanka Export Development Board (EDB) and supported by the Joint Apparel Association Forum (JAAF) and Sri Lanka Apparel Exporters Association (SLAEA).