Emerging Trade Portal
With a healthy growth rate, Sri Lanka could be the next business hub in the region.
Sri Lanka hosted a trade, tourism and investment exposition to showcase the various industries flourishing in the country.
To hold international events, which include foreign dignitaries and visitors, is a difficult task, especially for an underdeveloped South Asian country. And it becomes even more difficult if the country in question is a small one like Sri Lanka which has limited resources and which was fighting insurgency as recently as 2009.
This year, the small island nation surprised the world by hosting five major international events – simultaneously. The most important one, and also the most controversial, was the Commonwealth Heads of Government Meeting. Along with CHOGM 2013, the Commonwealth Business Forum, the Commonwealth Youth Forum and People-to-People Forum were also held in and around Colombo. A host of foreign delegates as well as visitors attended these events. Since all of them were high profile events, foreign media was also present in strength.
To benefit from the presence of the large number of foreign visitors in the country, Sri Lanka’s Ministry of Economic Development, Ministry of Industry and Commerce and Ministry of Investment Promotion together with Sri Lanka’s Export Development Board, the Tourism Promotion Bureau and the Board of Investment, co-organized a trade, tourism and investment exposition titled Reflection of Sri Lanka. The aim of the large scale event, which was inaugurated by Sri Lankan President Mahinda Rajapaksa, was to utilize the opportunities provided by CHOGM to showcase the various industries of Sri Lanka.
Although the venue for the exposition – the ‘Folk Art Centre’ in Battaramulla, a suburban area near Colombo – was an unusual choice for a trade show, it turned out to be a wise decision as it added color to the exhibition and aptly projected Sri Lanka’s culture, especially its eco-friendly policies.
It was obvious that much effort and thought had gone into decorating the venue. The main entrance, for example, was festooned not by colorful ribbons or other ornaments but by bottle gourd vines that made a beautiful and unique border. Then there were small patches of wheat crops and hut-style tea stalls entertaining visitors with a variety of world famous Sri Lankan teas.
The exhibition focused on seven key sectors of Sri Lankan exports: tea, apparel, gems and jewelry, spices, food, rubber products and ICT/BPO. According to the press release issued by the Export Development Board, the exposition hosted over 800 exhibitors comprising 350 direct exporters, 200 small and medium enterprises, 150 foreign technology providers, about 100 local machinery manufacturers and tourism stakeholders.
Speaking to SouthAsia about the exhibition, Ruchira Withana, Director of MIS and Industrial Registration & Productivity in the Ministry of Industry and Commerce, said, “This is not the first expo to be held in Sri Lanka; we hold such expositions from time to time. But what differentiates Reflection of Sri Lanka from other events of similar nature is its sheer magnitude. This is the biggest trade event in Sri Lanka’s history.”
Trade, tourism and investment are the main components of the Sri Lankan economy. The country’s exports contribute nearly 17 percent to the GDP. “Our export volume is around USD10 billion and the government of Sri Lanka has set the target of increasing it to USD20 billion by 2015,” said
Rishad Bathiudeen, the Minister for Commerce and Industry, in his press briefing to journalists from Pakistan.
In 2009, 63 percent of the total export earnings of Sri Lanka were derived from two products: garments ( 44 percent) and tea ( 17 percent). Realizing the adverse effects of dependence on only two sectors, the Sri Lankan government started making efforts to broaden the country’s export base. “The government plans to explore and focus on new markets, especially in China and the African region,” Bathiudeen said.
One of the reasons for this shift is the changing dynamics of international politics. There is increasing pressure on Sri Lanka to try those who allegedly committed war crimes in the concluding months of the three-decade-long civil war against the Tamil Tigers.
The U.K. spearheads this campaign. Incidentally, the U.K. is also a main export destination for Sri Lankan goods with an over 15 percent share in the country’s total export. Sensing the change in the international community’s tone, Sri Lanka is looking for new markets to save its economy from a possible shock.
This is why the Reflection of Sri Lanka exposition also gave an opportunity to foreign buyers as well as investors to visit Sri Lanka and explore new business avenues. “Around 170 foreign business delegates have been invited from 60 countries,” said Withana. “We received applications from as many as 2000 people but we couldn’t accommodate all of them. In addition to businessmen and industrialists, especially those who were in Sri Lanka for the Commonwealth Business Forum, around 3000 foreign visitors are also expected to come to the exhibition,” he said.
While the exposition showcased famous Sri Lankan export goods such as gems and jewelry, tea and textile items, the lesser-known sector of boat manufacturing also received much attention. There were stalls by leading boatmanufacturing companies of Sri Lanka, some of whom export their products to Scandinavian, Asian and Middle Eastern countries. Their products ranged from fishing boats to leisure boats, house boats, pedal boats and floating restaurants. One company at the exhibition, with a range of 40,000 boats, claimed to be the largest boat manufacturer in South East Asia.
The other sector which offered innovative services was tourism. Sri Lanka has seen a sharp rise in tourism since 2004 after the civil war. A number of hotels and resorts have been built and unique services are offered to tourists. One such service is that of ‘home stays’.
Travel companies offering the service have designated homes in different parts of Sri Lanka where tourists visiting the country can stay with a Sri Lankan family. “Introduced some two years ago, the service has gained popularity with tourists as it is a novel way of introducing the local culture to the world,” said Siri de Silva, a former president of the Association of Small and Medium Enterprises in Tourism (ASMET).
The tea stalls that offered a wide range of Sri Lankan teas also caught visitors’ attention. In addition to the usual green and black tea, there was flavored tea, organic tea and the highly expensive silver and goldentipped tea. The gems and jewelry stalls were a favorite with female visitors, both local and foreign. In 2012, Sri Lanka exported gems worth USD111 million; the British royalty is among the famous buyers of Sri Lankan gems. The blue sapphire on the engagement ring of Princess Kate Middleton came from Sri Lanka.
Other famous Sri Lankan exports which attracted attention were textile products and ceramics. Sri Lanka has been exporting garments to some of the world’s leading brands despite the fact that it does not produce the raw material. It imports raw material from India and Pakistan among other countries.
With a growth rate of 7.8 percent in the third quarter of 2013 – the highest in the region after Bhutan – business-friendly policies and lucrative investment opportunities, Sri Lanka is trying to launch itself as an up-and-coming business hub in the region. And the Reflection of Sri Lanka exposition surely marked the country’s arrival as a new player in the regional markets.