Forex crisis, power outages severely affects exports

The Joint Chambers of Commerce that met last week discussed the on- going forex crisis in the country and its impact on businesses and its economy. The chambers have come together as in the past when the country is facing a national crisis such as the current forex crisis that has paralysed the economy.

“There is a daily disruption of fuel and electricity supply and unfortunately the industries are unable to function. This has caused immense difficulties to most industries in the country. In the past when there was such power outages we used our generators. But today we are unable to do that due to a shortage of fuel,” said the Chairman of the Ceylon Chamber of Commerce Vish Govindasamy at a media conference convened by the joint chambers in Colombo on Monday.

He said the private sector employs a large number of people and their families are severely affected by this issue. “We have at different times made representations to obtain raw materials for exports and have informed our inability to pay overseas suppliers in a timely manner. We have highlighted this issue last December for a solution but did not receive a feed-back from the state. If the present trend continues sectors that bring in foreign exchange such as tourism and other export sectors are going to be affected as well,” he said.

The joint chambers demand that the government establish a market driven pricing formula for fuel, gas and electricity while also allowing flexibility on the exchange rate.

There is an excessive demand for goods due to subsidised pricing that can cause a huge deficit. “We have urged the state to restructure debts as most of our reserves are used to pay debts. We have recommended going to the IMF to seek a solution to the present crisis,” he added.

Chairperson of the Women’s Chamber of Industry and commerce Anoji De Silva said that most women entrepreneurs unlike big industries do not have cash balances to engage in businesses. Today they face tremendous difficulties owing to power outages and lack of gas to continue in their trade. A woman entrepreneur who needed US$4000 to participate in the Expo Fair in Dubai had to go from pillar to post for almost for two weeks to find this money. When such people do not attend trade fairs to secure orders they have to close down their businesses as well. Heads of other chambers also spoke.

We have highlighted this issue last December for a solution but did not receive a feed-back from the state.