Tea Exports Hit Rs. 123 Bn

The Sunday Leader - 06/10/2013

Tea export earnings in the first eight months of the year increased by Rs. 10.6 billion year on year (YoY) to Rs. 123.1 billion, Forbes & Walker (F&W) in a report said.

Export volumes in the review period increased by 1.7 million kilos YoY to 205.7 million kg.
Kenya, one of Sri Lanka’s competitors, in the first seven months of the year increased its export volumes by 52 million kg. YoY to 293 million kg., F&W said.

In the same period Kenya’s tea export earnings increased by Rs. 18 billion* to Rs. 109.7 billion.
Meanwhile Sri Lanka’s tea export earnings in August increased by Rs. 6.2 billion to Rs. 18.8 billion YoY.
Likewise tea export volumes increased appreciably by 9.5 million kg. YoY to 31.4 million kg.

The average tea price in the first eight months of the year increased by Rs. 47.10 to Rs. 599.45 per kg. in FOB terms, it said.

The highest price fetched was for green tea exports, which export quantity in the eight month review period comprised a mere 3.3 million kg. The average price fetched for green tea exports was Rs. 1,336.46 per kg. (FOB).

The next highest export price was for tea exports in bags. That comprised a total of 16.6 million kg. “Tea in bags” fetched an average export price of Rs. 1,070.28 per kg. FOB. It was followed by “instant tea” with a price of Rs. 999.42 per kg. (FOB) and a quantity of a mere 1.1 million kg. exported in the review period.
Those were followed by “tea in packets” and “tea in bulk” which in price terms comprised the fourth and fifth highest prices fetched for the five categories of teas exported from Sri Lanka, while in volume terms they comprised the first and second highest respectively.

“Tea in packets” fetched an average FOB export price of Rs. 549.93 a kg., while “tea in bulk” an average FOB price of Rs. 531.65 per kg. Their export volumes were: “Tea in packets” (101.7 million kg.) and “tea in bulk” (83 million kg.).

Bulk
The average price of tea in August increased by Rs. 22.83 to Rs. 598.76 per kg. in FOB terms.
“Tea in bulk”, the lowest export earner, led the pack in August with 10.1 million kg. and an average export price of Rs. 493.68 per kg. FOB. It was followed by “tea in packets” with 9.5 million kg. and a price of Rs. 524.83 per kg. FOB.

The highest value added earner was “green tea” with an average export price of Rs. 1,211.94 a kg. FOB. But its export volumes in August comprised a mere 350,321 kg. It was followed by “tea in bags” with a price of Rs. 1,134.40 per kg. FOB and an export volume of 1.9 million kg., while the third highest was “instant tea” with a price of Rs. 933.14 per kg. FOB, but with an export volume of an insignificant 28,833 kg.

Tea production, excluding CTCs in the first eight months of the year increased by 8.41 million kg. YoY to 215.1 million kg., F&W further said.

All elevations showed a YoY growth, with Low Growns showing the biggest gain, it said.
Low Grown production increased by 5.79 million kg. (4.44%) YoY to 136.3 million kg.
Meanwhile tea production in August was up by 0.71 million kg. YoY to 26.5 million kg.
While High and Medium Growns had shown a marginal decline YoY, Low Growns had shown an increase, the report said.

In related developments, CTC production in the first eight months of the year marginally declined by 0.2 million kg. YoY to 14.6 million kg., F&W said. While High and Medium Growns had shown a marginal gain, Low Growns had shown a decline, it said.

CTC production in August at 1.8 million kg. too showed a 0.3 million kg. YoY decline, the report said. August 2013 production in respect of all elevations showed a YoY decline, it added.
*On the basis that one Kenyan shilling was equivalent to Rs. 1.52 as at October 2, according to the internet.

Hub is Sri Lanka’s USP!’ – Powerful Swiss Investment Arm

Asian Tribune - 05/10/2013

Wolfgang Schanzenbach (Regional Director Asia Pacific of Switzerland Global Enterprise (SGE) meets Rishad Bathiudeen (Minister of Industry and Commerce of Sri Lanka-centre) on 03 October in Colombo.

Sri Lanka’s international Unique Selling Proposition (USP) is none other than its hub positioning. “At this moment, many countries in Latin America, Africa and Asia including Sri Lanka have great investment opportunities.

Sri Lanka will have to compete with these countries to leverage foreign investment streams from Switzerland” revealed a very confident Wolfgang Schanzenbach, Regional Director Asia Pacific of Switzerland Global Enterprise (SGE) on 03 October in Colombo.

Director Schanzenbach was addressing Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka on 03 October during his courtesy call on Minister Bathiudeen. Also present along with Director Schanzenbach was (HE) Thomas Litscher (Ambassador of Switzerland to Sri Lanka.

According to the Department of Commerce, bilateral trade between Sri Lanka and Switzerland stood at $ 325.76 Mn in 2012. Sri Lanka`s exports to Switzerland have shown a slight growth during the past years except in 2009. Sri Lanka’s total exports to Switzerland recorded the highest level of US $ 91.75 million in 2012. Parts of electrical apparatus for switching or protecting electrical circuits has been the main item of exports (32.42% of total) followed by printed circuits (14.44%), Gold, other semi-manufactured forms (9.02%), Precious stones; gem (8.06%), Apparel (6.5%) etc.

Sri Lanka received Foreign Direct Investment (FDI) from Switzerland totalling $ 14.46 Mn in 2012.

Director Schanzenbach’s SGE brand, the powerful entity operating under the Swiss government, is Switzerland’s center of excellence for internationalisation and it is involved in exports, imports and investments (to Switzerland) and works very closely with Swiss SMEs to achieve these objectives. Director Schanzenbach, currently in Sri Lanka on a fact finding mission, will explore emerging and other investment opportunities here, for Swiss investors.

“Except for Swiss multinationals such as Nestle, Holcim etc, almost 99% of Swiss GDP is driven by the SMEs, which also is the driver of the country’s global growth. We at SGE are a strong and trusted partner for our clients, the cantons and the Swiss government, with a global network of experienced advisers and experts. Swiss government initiated investments are very limited. It is the private sector of Switzerland that is leading overseas investments, with the support of Swiss government. Representing the private sector, I am here to discover new opportunities and whether we can place Sri Lanka firmly on Swiss investors’ map. At this moment, many countries in Latin America, Africa and Asia including Sri Lanka have great investment opportunities. Sri Lanka will have to compete with these countries to leverage foreign investment streams” said SGE Director Schanzenbach. “I need to identify Sri Lanka’s USP after which I can make some initiatives so that Sri Lanka can enter Swiss investment map. But remember, you compete against many others.”

Minister Bathiudeen, addressing SGE Director Schanzenbach explained of Sri Lanka’s hub positioning and five hub concept in depth. “Our ports and services sectors are rapidly developing. Sri Lanka government’s policy is one of encouraging foreign investments. Sri Lanka’s labour force is literate and skilled with a strong professional presence. In that, they are highly trainable. These are apart from GSP entitlements we have” Minister Bathiudeen said and added. “Our hub positioning not an isolated structure but is strengthened through the strong Free Trade Agreements we have with the huge Indian Sub continental markets, Pakistan and India. For example, we can export over 4000 items to India under FTA with advantages.”

“This is a very strong point for Sri Lanka” responded SGE Director Schanzenbach, who is in charge of SGE’s Asia Pacific region, and added: “I see that Sri Lanka’s own market is very small but when looking at the hub aspect, I can clearly see that Sri Lanka is usable as an import value addition point from where we can re-export to the huge Indian Sub-Continent. That’s really an investment advantage and a USP. Definitely, Sri Lanka’s hub positioning is a great advantage in resourcing investment Dollars here!”
Minister Bathiudeen revealed: “For Swiss investors, immediately available opportunities in Sri Lanka based on hub positioning are in mineral sands such as silica and graphite as well as rubber production for which we invest eager Swiss investors.”

Also present during the session were advisers to Minister Bathiudeen and officials of NEDA, EDB and Department of Commerce operating under him.

Japanese apparel market craving for more Lankan made supplies

Daily Mirror - 01/10/2013

Apparel exports must be expanded to cater to the growing demand for Sri Lankan made products in the Japanese market, according to Japan’s House of Councillors Member Yamatani Eriko.

“Sri Lankan apparels are of high quality but unfortunately, the supply of Sri Lankan apparels to the demand of the Japanese market is not sufficient at the moment. Therefore, we request steps be taken to expand exports of Sri Lankan apparels to Japan.

Bilateral trade between Sri Lanka and Japan has a very long history and trade is one of the most important aspects of our bilateral relations. Ceylon tea and other Sri Lankan products such as apparels and ceramics are already popular in Japan,” Eriko stated.

Leading a six-member delegation from the upper House of Japan’s legislature, the National Diet, Eriko made the comments during a meeting with Industry and Commerce Minister Rishad Bathiudeen.

The Japanese apparel market is currently estimated to be as large as US $ 122 billion. Total exports of Sri Lankan apparels reached US $ 2.77 billion in 2012. However, Japan is only the 14th largest buyer of Sri Lankan apparels, accounting for less than 1 percent of export revenues.

Responding to Eriko’s comments, Bathiudeen expressed confidence in the potential for expansion of Sri Lankan apparel exports to Japan, while also welcoming Japanese investment into the Sri Lankan apparel sector.

Bathiudeen added that the potential for exploration of investment opportunities in Sri Lanka by Japanese businesses was particularly suitable in the backdrop of Sri Lanka hosting the Commonwealth Heads of Government Meeting (CHOGAM) in November this year.

Also participating in the discussions were Japanese Ambassador to Sri Lanka Nobuhito Hobo, Export Development Board Director General Sujata Weerakoone, Industry and Commerce Ministry Advisor Himali Jinadasa, Acting Director General of Commerce R.D.S. Kumararatne and Deputy Director of Commerce D.W. Jinadasa.

Total trade between Sri Lankan and Japan crossed US $ 770.11 million in 2012 as compared with US $ 493 million in 2002. The trade balance is skewed in favour of Japan largely due to motor vehicle imports.

Govt: Lanka companies bullish at EDB’s first ever China-Lanka direct B2B

The Island - 29/09/2013

"Eager Sri Lankan biz has experienced a sudden boost and witnessed new doors of opportunities on 26 September with a surge of inquiries from the powerful Chinese businesses now scouring Sri Lanka," the Ministry of Industry and Commerce said in a statement.

On 26 September, one hundred (100) Lankan firms of small, medium and large scales met reps from 23 powerful Chinese firms that arrived in Sri Lanka on 25 September as part of the Chinese Trade Promotion delegation to Colombo.

This is the largest Chinese private sector delegation to visit Sri Lanka. The Chinese delegation is led by Jia Guoyong, the Vice Director General of Chinese Trade Development Bureau (TDB). This is one of the strongest such Chinese delegations to arrive in recent Lankan trade history. The 36 member strong Chinese delegation consists of unprecedented Chinese private sector representation with 23 companies taking part in glass manufacture, mining/minerals, agriculture, polymer/petroleum bi-products, chemicals, and real estate. Three of the firms are in Fortune 500 list- Sinochem Group ($49.5 Bn revenue), China Minmetals ($ 37.5Bn) and Sinosteel ($27.2Bn). Among other visiting firms are Anhui Light Industries International Co., Ltd. (ALIC), Zibo Top Arts, Zibo Honghan Trading, Shandong Hanbang Household Glassware, Zibo Unishine, XinHe Commerce and trade Refco Group, Hebel Kaifa Glassware, AVIC International Holding, CITIC International, Chinatex, China National Township, Sinosteel Raw Materials, Sinochem Guangdong, and Sinochem Plastics.

During the four hour long Sri Lanka-China Business Meeting –the B2B matchmaking sessions facilitated by EDB- held at Cinnamon Lake Hotel on 26 September, the 23 Chinese firms met 100 Lankan firms for potential partnership on diverse sectors of interest.

Among the potential partnership avenues discussed were overall trading (both import/export), importing from Sri Lanka, exporting to Sri Lanka and business joint ventures.

EDB, on 27 September, said that the majority of Sri Lankan businesses that took part in the EDB facilitated B2B session, reporting ‘it was a very effective session’ with many potential partnership leads being generated for them.

Among the business sectors at play at the B2B session were chemicals, petroleum and fuel refining, activated carbon, metals (including non-ferrous), agriculture, financials, rubber and rubber products, plastics, activated carbon, glass and real estate.

On the eve of 26 September after the B2B sessions were over, many reps from the Chinese business side confirmed successes with eager Lankan firms, but insisted that it is premature for them to reveal the identities or Lankan partnership details since ‘they have to process paperwork back home on nature of partnerships and determine exact Lankan (product) HS codes first.’

"We had very good, very successful meetings today. We also identified one Lankan partner firm for trading in Activated Carbon" said Anqi Fu, the Business Manager of CITIC International (Fortune 500 ‘CITIC Group’ s annual revenue at $ 43 Bn, subsidy CITIC International annual revenue at $ 500 Mn). "The next step is to identify the exact product categories. We will start buying through the Lankan partner firm as soon as possible once the agreements finalised. We are also thinking of increasing purchase volumes in future but in step by step process" Qi Fu added.

"We had discussions with no less than 45 Lankan companies today" said a somewhat exhausted Ms Wang Zhi Jie (Assistant Manager-Strategic Planning) of Beijing’s SINOCHEM Group (Fortune 500 firm, with $49.5 Bn revenue). "There was a strong demand from many Lankan firms to partner with us. We are focusing on chemical products and fuel refining. We listed several Lankan firms for partnership possibilities demanding refining services from us. We have an annual refining capacity of 1200 tonnes. We also have positive negotiation outcome for partnership with one Lankan rubber supplier for SINOCHEM’s rubber plant in China. We are ready to start buying as soon as Sri Lankan firm’s quotation is approved by our SINOCHEM offices. We are also looking for both import as well as export trading" added Ms Jie.

Han Ven Han (Manager Operations -Beijing’s SINOSTEEL Metals) said: "We had many rounds of discussions with seven Lankan firms. And our cooperation prospects are looking good. We are looking for mineral sourcing from Sri Lanka as well as partnering in logistics and services. Within logistics, we are looking specifically for transport, warehousing and in the general value chain of logistics. We are still at fact finding stage and in discussion with the seven companies and we will make our decision back home based on what we learn here. We will also look into the possibility of investing in Sri Lanka on logistics. Sri Lanka’s geographic and marine location is very strategic for logistics, which is the reason we are interested. We also want to source metals from Sri Lanka."

Gua Honghai [Administrative Officer of China Minmetals Non-Ferrous Metals Co Ltd, one of 800 subsidy firms of Fortune 500 ranked China Minmetals which has $ 37.5Bn revenue)], is keenly scouring for non-ferrous metal supplies from Sri Lanka-in large volumes. "We are looking to buy non-ferrous metals in large quantities. We are in need of 100,000 tonnes of copper, 100,000 tonnes of zinc and 400,000 tonnes of aluminium annually" said Honghai, and revealed: "But today, I could not locate any Sri Lankan suppliers who can give me these volumes even after speaking to ten companies. We are realising that Sri Lanka has no non-ferrous resources that we can make use of. But that is not the only option we have for Sri Lanka-there are still other avenues of business for us here, specially in logistics which we are now looking at. I also think Sri Lanka should learn from Singapore as to how to use your very distinct, strategic geographic location advantage to make it a maritime transport hub."

China seeks minerals, logistics services from Sri Lanka

Lanka Business Online - 28/09/2013

Chinese firms are planning to buy activated carbon and rubber from Sri Lanka following the visit of a trade delegation and others are in talks over minerals and logistics services, the island's trade ministry said.

"We have identified one Lankan partner firm for trading in activated carbon," An Qi Fu, international business manager of CITIC International, a Chinese state firm, was quoted as saying in a statement.
"We will start buying through the Lankan partner firm as soon as possible once the agreements finalised."

The Chinese trade delegation led by Jia Guoyong, the vice director general of the Chinese Trade Development Bureau (TDB), had 23 companies in glass manufacture, mining, minerals, agriculture, polymer, petroleum bi-products, chemicals, and real estate.

The trade mission met around 100 companies at a meeting arranged by Sri Lanka's Export Development Board.

There was a strong demand from many Lankan firms to partner with us," Wang Zhi Jie, assistant manager of strategic planning at Sinochem group was quoted as saying.

"We have a positive negotiation outcome with one Lankan rubber supplier for Sinochem’s rubber plant in China. We are also looking for both import as well as export trading."

China is among Sri Lanka's top trading partners with imports of 2.4 billion US dollars in 2012 and exports of 108 million US dollars.

Chinese good are usually costs less, and help increase the living standards of lower income Sri Lankans particularly as they try to build a roof over their heads, battling the high building materials prices of protected domestic producers.

But analysts say in order to beat protectionist taxes on some imports, lower quality goods may be imported at times.

Anhui Light Industries International Co., Ltd. (ALIC), Zibo Top Arts, Zibo Honghan Trading, Shandong Hanbang Household Glassware, Zibo Unishine, XinHe Commerce and trade Refco Group, Hebel Kaifa Glassware, AVIC International Holdings, Chinatex and China National Township were also in the delegation.

Han Ven Han, manager operations at Sinosteel Metals was quoted as saying that they were in talks with seven Sri Lankan firms.

"We are looking for mineral sourcing from Sri Lanka as well as partnering in logistics and services," he said.
"Within logistics, we are looking specifically for transport, warehousing and in the general value chain of logistics. We will also look into the possibility of investing in Sri Lanka on logistics."

Gua Honghai from China Minmetals Non-Ferrous Metals Co Ltd said they were looking for copper, zinc and aluminium suppliers and found out that there were none in Sri Lanka but were interested in the location as a logistics base.

Sri Lanka has ports and airports with quick connections to the Indian subcontinent and other areas.

India has become a large importer of Chinese goods with bi-lateral trade at over 66 billion rupees last year.

China has financed a second international airport and an industrial port in Hambantota in the South.

A Chinese state-firm has also built a container terminal in Colombo.

Saudi buyers, sellers invited to trade exhibition in Sri Lanka

Arab News - 27/09/2013

The Sri Lankan Embassy has invited buyers and sellers to participate in an exhibition to be held concurrently with the Commonwealth Heads of Government Meeting (CHOGM) 2013, scheduled to be held in Colombo from Nov. 13.

Anil Sirimanne, commercial counselor at the Sri Lankan Embassy, told Arab News that the event, which will discuss Sri Lanka’s trade, tourism and investment, will also coincide with the Commonwealth Business Forum (CBF), which will also be held in Colombo during the same period.

The Commonwealth is a voluntary association of 54 independent countries and the CHOGM is held every two years to enable leaders of Commonwealth countries to come together to discuss global and Commonwealth-related issues and to decide on collective policies and initiatives.

Running parallel to the CHOGM, “Reflection of Sri Lanka,” an international exhibition on trade, tourism and investment, will be held from Nov. 13 to 17 in Colombo, in which numerous private and public sector agencies will be participating.

More than 300 leading exporters of various sectors from Sri Lanka and foreign machinery and technology suppliers will showcase their products and services.

It will be held at the Folk Art Center (Janakala Kendraya) in Battaramulla, a suburb in the capital, Colombo.
“The Embassy of Sri Lanka in Riyadh would like to invite you to participate in this exhibition to develop economic relations with Sri Lankan partners. You can register as a buyer or an exhibitor at the exhibition,” Sirimanne said, adding that attractive travel packages will be offered to participants by the sponsors of the event.

“Sri Lanka is privileged to hold this summit this year. This is the first time an Asian country hosts such an event in 24 years. This prestigious event presents Sri Lanka with a valuable opportunity to promote and reposition Sri Lanka as a strategically important economic center of the world.”

The exhibitors are expected to maintain the highest quality and international standards in displaying their products.

The diplomat said the trade exhibition will be a great opportunity for leading exporters and potential exporters to present their capabilities to the heads of Commonwealth States, high-powered delegations, business leaders and other foreign buyers, which will pave the way to further pursue their business in the global market.

The exposition on trade, tourism and investment will be organized by the Ministry of Economic Development, the Ministry of Industry and Commerce and Sri Lanka Tourism and Board of Investment (BOI) in collaboration with the Sri Lanka Export Development Board (EDB) and in association with other government agencies to showcase Sri Lanka’s export portfolio at its best.

The exposition includes product displays, networking sessions, seminars and industry visits. Foreign exhibitors will present state-of-the-art equipment and technology.

Promotional packages include a 25-percent discount on airfare to and from Colombo, gratis visa, internal transport, including airport pick up free of charge and concessions for hotel charges.

Ten Prominent Business groups to represent Sri Lanka at Pakistan EXPO 2013

Asian Tribune - 26/09/2013

High Commissioner of Pakistan Qasim Qureshi with the participants of expo 2013

The High Commissioner of Pakistan in Sri Lanka Maj Gen (R) Qasim Qureshi hosted the Sri Lankan businessmen participating in Pakistan EXPO 2013 along with the officials of Export Development Board Sri Lanka, today at the High Commission of Pakistan prior to their departure for Karachi.

Ten companies from Sri Lankan representing various sectors such as tea, herbal cosmetics, commercial paints, bicycles, fruits & vegetables, textiles and pharmaceuticals sectors will attend the largest EXPO of Pakistan, from 26-29 September, 2013.

Expo Pakistan is the biggest trade fair in Pakistan, showcasing the largest collection of Pakistan's export merchandise and services. Foreign exhibitors, from neighbouring countries, also use this platform to launch their products. Held annually in the month of September, the four day Expo Pakistan has become the primary sourcing point for a large number of businesses worldwide, giving them a head start on the buying and ordering for coming seasons.

The Export Development Board of Sri Lanka has booked a separate Pavilion at the EXPO Center Karachi to showcase the Sri Lankan products.

During their stay in Pakistan, the Sri Lankan delegation will interact with the representatives of various business chambers and hold B2B meetings with businessmen of Pakistan.

The High Commission of Pakistan in Sri Lanka had formally launched The EXPO Pakistan 2013- Opportunities Unlimited on 24 June, 2013 in Colombo under the patronage of Minister for Industries and Commerce Sri Lanka, Rishad Bathiuddin.

The Expo 2012 generated over US$ 518 Million business with the participation of over 600 buyers from over 52 Countries.