Emerg­ing Trade Por­tal

With a healthy growth rate, Sri Lanka could be the next busi­ness hub in the re­gion.

Southasia - - CONTENTS - By Jave­ria Shakil

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.

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