Sri Lanka's bilateral trade with Israel surges 178% since trade pact in 2007

The Colombo Page - 08/09/2014

Sri Lanka's bilateral trade with Israel has surged by 178% since a trade pact signed in 2007, signaling even closer B2B links between the two countries, a press release issued by the Ministry of Industry and Commerce said.

"We have a history of bilateral trade and business cooperation with the State of Israel. This time we took about 40 leading businessmen to Israel from Sri Lanka and completed a successful Business Forum", Sarath Wijesinghe, Sri Lanka's Ambassador in Israel said Friday at a business review meeting in Colombo.

He was addressing the progress review meeting of the recent Lankan trade and business delegation to Israel facilitated by Export Development Board (EDB) and supported by the Ministry of External Affairs. Taking part at the session were business representatives, who were in the July 2014 delegation to Israel.

In July, a trade and business delegation from Sri Lanka consisting of 40 business leaders led by Neomal Perera (Deputy Minister of External Affairs) completed a successful Business Forum in Israel, interacting with their Israeli counterparts, including the well- known L.R. Group, and Sri Lanka-Asia Chamber of Commerce.

The businesses in the mission shared interests in such sectors as tourism, hi-tech, water, energy, medical, apparel, employment, agriculture, greenhouse cultivation, dairy, fish, flowers, diamonds, gems, jewelry, rubber, and education. Dr. Lakshman Jayaweera (Chairman-BOI), Dr. Nandalal Weerasinghe (Deputy Governor of the Central Bank), business reps from Chambers of Commerce and various sectors addressed the Seminars.

In April 2007, Sri Lanka and the State of Israel signed a historic Trade and Economic Co-operation Agreement of general nature enhancing bilateral relations to new levels. Since then, bilateral trade has surged by a huge 178%, as of December 2013.

According to the Department of Commerce, in 2013, total bilateral trade between Sri Lanka and Israel stood at US$175.63 million, rising by 11% from 2012. The balance of trade was in favor of Sri Lanka. Diamonds, brought down from Israel to Sri Lanka are value added here and re-shipped to Israel. Annually such diamond imports and exports exceed US$ 50 million mark and in 2013, diamond exports to Israel rose to US$ 79 million, claiming 80% of 2013's Lankan exports. Tea, fish, pneumatic rubber tyres, and special yarns were other Lankan exports to Israel in 2013. In the same year, leading imports from Israel were diamonds, filaments and miscellaneous chemicals.

Herzliya based LR Group, the Israeli project development firm operates globally in financing, constructing, and managing medium and large scale projects in developing economies. It also reportedly has a track record of creating and managing over US$1 billion agriculture projects around the globe in Africa (Angola), Asia & Pacific, Russia and Central Asia, South America, and Europe.

‘Our trade future looks good!’: Seychelles

Daily FT - 03/09/2014

• New air-connectivity boosts exports, transit travel: Seychelles
• 'Proposing first Lanka-Seychelles Jt. Committee!’: Rishad
• 'Accepted! You also get COMESA market!’: Minister Laporte

Enhanced trade cooperation cemented by a new Joint Trade Committee will open Sri Lanka’s anticipated trade volumes with Africa said Seychelles on 27 August. Lankan exports to Africa’s top blue economy as well as transit passenger volumes to Colombo is now on the increase as a result of recent air connectivity.

“The prospective Joint Trade Committee between Sri Lanka and Seychelles will be Sri Lanka’s platform for accessing the huge African market. Almost all the issues regarding quarantine of certain exports have now been resolved and all requirements met! As a result we are now receiving loads of more Lankan fresh fruits and vegetables than before,” said an upbeat Minister for Finance, Trade and Investment of Seychelles Pierre Laporte in Colombo.

Visiting Minister Laporte was addressing Minister of Industry and Commerce of Sri Lanka Rishad Bathiudeen during his official courtesy call on Bathiudeen on 27 August at EDB, Colombo. Minister Laporte is currently leading a 20 member Seychelles business and investment delegation to Sri Lanka. Just prior to the courtesy call on Bathiudeen, Laporte joined for the opening of first Lanka-Seychelles Business Forum organised by the EDB. Also present at the courtesy call were Seychelles’ High Commissioner to Sri Lanka Waven William, EDB Chairman and CEO Bandula Egodage and Department of Commerce of Sri Lanka DG R.D.S. Kumararatne.  According to the Department of Commerce, the total bilateral trade between Sri Lanka and Seychelles was reported at $ 3.7 million in 2013. Main products exported from Sri Lanka included tea, fishing vessels, cereals and sausages, while the main imports from Seychelles were some spices. Sri Lanka believes that gems and jewellery, furniture, other types of ocean vessels, seafood and plastic products, have strong market potential in Seychelles. As for COMESA, it began in 1994 and currently has 21 member states (Angola, Burundi, Comoros, Democratic Republic of Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia, and Zimbabwe) opening an African market of 390 million.

Addressing Minister Laporte, Minister Bathiudeen said: “We welcome you in your first visit to Sri Lanka at a time we expect positive GDP growth here exceeding 7%, thanks to the committed vision of HE the President Mahinda Rajapaksa. Our Free Trade Agreements with India and Pakistan opens more than 8,000 product lines to be exported from Sri Lanka – tariff free. This South Asian market is an almost 1.3 billion strong that Seychelles businesses can aim at, through Sri Lanka. Today I propose that both Seychelles and Sri Lanka form a Joint Trade Committee to strengthen trade and business cooperation. I also propose a top Lankan business and trade delegation to Seychelles, possibly this October or November.”

“We will be very happy to receive a Lankan trade and business delegation to Seychelles to explore opportunities. Yes, this is something we can make it happen. This Joint Trade Committee is a good suggestion and could be set up during your delegation’s forthcoming proposed business visit to Seychelles possibly in October or November this year. I stress that your entry to Seychelles opens Africa’s COMESA market for you,” said Laporte responding to Minister.

“There are a whole lot of new opportunities -in that since we in Seychelles have free market access to all the 19 COMESA (Common Market for Eastern and Southern Africa) countries and the 26 country bloc of Southern African Development Community (SADC). There are immense benefits to be gained. The prospective Joint Trade Committee between Sri Lanka and Seychelles will be Sri Lanka’s platform for accessing the huge African market. We are also interested in education services in Sri Lanka – already we have an arrangement with the accredited Maritime School in Sri Lanka, and already our students are here.
“Almost all the issues regarding quarantine of certain exports that arose when we commenced air services between both countries have now been resolved and all requirements met! As a result we are now receiving loads of more Lankan fresh fruits and vegetables than before. Also important is that now more international travellers are directly coming to Sri Lanka from Seychelles, to transit to Asia from Colombo, abandoning their usual transits to Asia through the Middle Eastern airports.

“We have cinnamon everywhere even in jungles and home backyards. But we cannot process or produce it competitively due to higher labour cost and the current labour is diverted to our tourism and fisheries. Therefore our freely available Cinnamon sector is also a good investment opportunity for Lankan investors. We will be very happy to assist investors willing to invest in our cinnamon sector. The Sri Lanka – Seychelles trade and business future looks good!”

Responding to Laporte, Bathiudeen said: “We are happy to see that now there are two flights a week between both countries, helping to increase business. Tourism, fisheries and education are promising sectors for immediate cooperation. Since the Indian Ocean Tuna Commission (IOTC) head offices are also located in Seychelles, fisheries cooperation with Seychelles could be further expanded.”

EDB tackles value addition and packaging for spices

Daily FT - 03/09/2014

Spice exports have recorded a 40% increase, with the key challenge being how to market Sri Lanka’s products to gain better returns, an official said yesterday.
Sri Lanka’s total spice exports in 2013 stood at $ 329 million, rising by 40% from 2012’s $ 236 million. Last year’s spice exports revenue were also a leap of more than 100% from 2009’s $ 115 million, Export Development Board Chairman Bandula Egodage told companies at the first national packaging awareness seminar.

“The key factor is how to market our spices. The first impression from packaging tells a lot to the consumer. Our spices are traditionally exported in bulk form. Sri Lanka now encourages value-added exports and discourages raw exports,” he was quoted as saying in a statement by the Industry and Commerce Ministry.
“Production of raw material is encouraged but not exporting of them since they need to be value added here for much-needed foreign currency.”

He insisted the primary objective is to create awareness for exporters on packaging quality of spice exports. Secondly, to identify global market trends, easy identification and novel appearance in packaging which enhances brand value and creates additional sales. Thirdly, Sri Lanka needs an open dialogue among exporters, industry and EDB so that exports are boosted.

The EDB has invited the Sri Lankan packaging sector to take part in various international trade fairs facilitated by EDB but with their own financial arrangements. They had pointed out the internationally-accredited ‘Pure Ceylon Cinnamon Global Certification’ Lion logos as a step by the EDB to promote marketing of spices for better revenue.

The ownership of Pure Ceylon Cinnamon Global Certification is vested with the EDB. The international permission of this is obtained under the Geographical Indicator framework. This certification would give maximum value to true cinnamon, which has competition from cheap cinnamon called cassia.
Last month, 13 selected Lankan cinnamon exporter firms which were successful in fulfilling the required criteria to win the official sanction for the usage of the internationally-accredited ‘Pure Ceylon Cinnamon Global Certification’ were awarded their certifications.

Record number of SMEs to participate in FACETS Sri Lanka 2014

Daily FT - 01/09/2014

Over 50 small and medium enterprises will take part in FACETS Sri Lanka 2014, the international gem and jewellery exhibition, according to the organising committee. Organised by the Sri Lanka Gem and Jewellery Association (SLGJA), this year’s event held for its 24th year, will be held from 4-7 September at the Sirimavo Bandaranaike Memorial Exhibition Centre.

FACETS Sri Lanka 2014 this year specially highlights the individual exhibitor pavilions from, the National Gem and Jewellery Authority (NGJA) and an SME pavilion from the Sri Lanka Export Development Board (EDB). These moves come as an encouraging and positive sign with the entire industry with targets to achieve $ 1 billion export revenue by 2016. The National Gem and Jewellery Authority will also be providing gem testing and assaying facilities at the event.

Upbeat about the participation an SME stall holder sharing his views said: “FACETS 2014 not only provides ample opportunity for local businesses to showcase their capabilities to participating delegation from around the world, but also creates strong networking, knowledge sharing and skill enhancing opportunities for the SME sector enterprises. Local manufacturers will be able to acquire knowledge on technology, process, best practices and the importance of maintaining industry quality standards right throughout the event.”
Further encouraging the local industry a gem cutting competition will also be held this year. The objectives of the competitions were to identify and recognise the capabilities of local talent and help promote the gem cutting and lapidary industry to be in par with the required export quality.

FACETS 2014 Juzar Adamaly Chairman said: “The SME sector plays a vital role within the entire gem and jewellery industry. The Government has also introduced a loan scheme to the SME sector further understanding the importance of nurturing quality businesses and products. We would like to take this opportunity to acknowledge the continuous support by the National Gem and Jewellery Association and the Export Development Board throughout all our initiatives locally and internationally”.

The organisers have planned to display precious and semiprecious gems as well as jewellery, lapidary and machinery items. Knowledge sharing sessions include a series of seminars conducted by international and local panellists this year.

Govt. keen to triple rubber industry to $ 3 b

Lanka News Papers - 31/08/2014

Sri Lanka is on its way to making the rubber industry a $ 3 billion sector, Minister of Industry and Commerce Rishad Bathiudeen stated following the announcement that the 4th Global Rubber Conference (GRC) and Exhibition will be held in Colombo from 27 to 30 October.

The GRC, formerly held as the Asean Rubber Conference until 2010, has been held in Cambodia (2011), Vietnam (2012) and Indonesia (2013) so far, while Sri Lanka will be hosting it for the first time with over 700 trade visitors and 28 countries set to participate.

The event, co-organised by the Sri Lanka Export Development Board and Confexhub, will be themed Sowing the Seeds of Sustainable Future . The Ministry of Plantation Industries and the Ministry of Industry and Commerce have extended their support for the event as well.

We are now aiming at an ambitious $3B rubber industry in the coming decade. To arrive at this $3B in a viable manner, it is essential for us to support the rubber industry including growers. I believe it is time for a long term development plan for this sector, said Minister Bathiudeen, speaking at the launch of GRC in Colombo on Thursday.
There are several important socio-economic reasons to strengthen this industry. It is time for a long-term development plan for the rubber sector, he stated.

In that context he said that hosting the GRC will be a great opportunity for Sri Lanka to take the sector to the next level, providing local stakeholders a chance to network with their international counterparts.
In 2013, Sri Lanka earned $ 72 million in rubber exports as well as $ 887 in rubber finished products. The total earnings of $ 960 million was a 100% increase in earnings from 2009, the Minister added.

Sri Lanka is currently the sixth largest exporter and the eighth largest natural rubber producing country in the world while the Government has set in place a 10-year plan to develop the sector.

Meanwhile, the Ministry of Industry and Commerce also announced the implementation of two projects including the first ever rubber industry database as well as a national rubber research consensus at a cost of more than $ 46,000.

Commenting on the current situation regarding the rubber sector in Sri Lanka, Export Development Board (EDB) Chairman and Chief Executive Bandula Egodage explained that the rubber industry was separated into the plantation services, pertaining to raw rubber production, and the rubber product manufacturing services.

He stated that the EDB has initiated several projects to improve the industry while it encouraged value addition as opposed to raw exports.

We do not intend to curtail raw rubber production in Sri Lanka, but as part of our export vision, we are looking to add value to our exports. That is our mandate and direction, he said.

Egodage highlighted the importance of networking, awareness, investment and global recognition which is where hosting the GRC in Sri Lanka would benefit local stakeholders.

The GRC will bring together stakeholders from the US, Europe, East Asia, North Asia and ASEAN countries to discuss issues concerning the global NR situation, strategies and challenges for sustainability, enhancing quality and several other issues.

The International Rubber Research and Development Board Secretary General Dr. Abdul Aziz urged all rubber players, policy makers, industry experts, producers and manufacturers to make use of this opportunity to discuss strategies aimed at expanding the rubber industry for global sustainable growth.
He explained that current global rubber prices are not conducive but predicted that they would recover. The GRC will help participants discuss the challenges that lie ahead as well as new material and strategies to improve value addition.

According to Dr. Aziz, over 50,000 products are made from rubber and around 70% of rubber production goes into the tyre industry.

He shared his optimism regarding the future of the global sector, revealing current initiatives that focus on working with different species of rubber trees.

We are currently only working with one species (Hevea brasiliensis) but there are nine recorded species of trees. Projects are under way to head into the Amazon jungle in Peru to collect these other species, he said.
Confexhub CEO and Director of the Organising Committee of the GRC, Paul Yeo briefed the gathering on the itinerary for the four-day event, underlining its key speakers and segments.

The conference will feature speakers from 12 countries, 20 paper presentations by the cream of the rubber industry covering topics under six special-focused areas and a forum discussing venturing into new planting areas in non-NR producing countries, he said.

The conference will also include a pre-conference study tour of the Sri Lanka Rubber Research Institute as well as a post-conference half-day tour to the only rubber auction in the world, which is administered and managed by the Colombo Rubber Trader Association.

Sri Lanka-China FTA deal during Chinese President’s visit next month

Sunday Times - 31-08-2014

Sri Lanka will be launching its Free Trade Agreement (FTA) with China making the biggest leap forward in relations between the two countries in more than 60 years, during Chinese President Xi Jinping’s state visit to the island next month, official sources revealed.

Mr. Xi will be accompanied by a 150-member top level delegation including senior officials, billionaire businessmen industrialists and investors.

The Chinese leader will become the first President to visit Sri Lanka since former leader Li Xiannian in 1986. His visit assumes significance in strengthening ties between the two countries, with China investing heavily in the island nation, the sources said. The joint feasibility study on the FTA has been finalised and negotiations on formulating the agreement including the negative list are underway between officials of the departments of commerce between the two countries, a senior government official told Business Times.

The agreement will cover wide areas relating to trade, services, tariffs, market access in China, diversifying Sri Lanka’s exports and overall enhancement of the country’s export potential to China. Sri Lanka is currently negotiating 100 per cent tax concessions for Sri Lankan exports including apparels, coconut, rubber, tea based products, precious stones and jewellery, etc, a senior Treasury official said adding that Sri Lanka’s professional services would not be opened to China under this agreement. China is to get tax concessions on exports of large machinery and equipment used in the construction sector but not manufactured locally.

However he said that these areas are still under negotiations and all these aspects would be taken into consideration before finalizing the agreement, he revealed. China is the 18th largest export market for Sri Lanka with exports of US$ 121 million in 2013, just 1 per cent of total exports of Sri Lanka and the import of US$ 3 billion worth of goods to Sri Lanka equals the value of goods imported from India. This indicates a huge unfavourable trade deficit between the two countries, he disclosed.

Last week, the Business Times quoted Commerce Department Director General R.D.S. Kumararatne as saying that the FTA would most likely be ready for signatures by end 2014 or next year.

Rubber Industry Facing Great Challenges

The Sunday Leader - 31/08/2014
By Roy Silva

 

The rubber industry is facing great challenges from an increasingly competitive global market, said Dr Abdul Aziz, Secretary General of International Rubber Research and Development Board (IRRDB) and also the Chairman of Confexhub Malaysia on Thursday in Colombo.

Announcing the Global Rubber Conference to be held in Sri Lanka in October, he said that in the past few years, many other commodities had surpassed the rubber industry and therefore, it was imperative for the rubber industry to gear up and meet those challenges. The 4th Global Rubber Conference (GRC 2014), one of the world’s leading conferences on rubber sector, is to be held in Colombo from October 27 to 30.

Sri Lanka, the world’s 6th largest exporter and the 8th largest natural rubber producing country, will be hosting the event co-organised by the Sri Lanka Export Development Board and Confexhub with the strong support from both the Ministry of Plantation Industries and the Ministry of Industry and Commerce of Sri Lanka. ‘Sowing the Seeds for Sustainable Future’ is the theme of the event held to provide rubber and rubber products experts and policy makers, captains of industry and serious investors a platform to converge and meet face-to-face to discuss a wide spectrum of commercial, research and development and the 2014-15 price outlook.

Over 700 trade visitors and delegates from 28 countries including the Americas, Europe, East-Asia, North-Asia and ASEAN are expected to participate in the conference to discuss issues on the current global situation, strategies and challenges for sustainability, enhancing quality, tyre and dipped goods industry outlook and development, etc.