EDB to set afloat boat building industry in global markets

Boat building is a lucrative and thriving industry which was capitalised on by the Western world during the previous decade. The centre for manufacturing boats is now moving towards developing countries mainly due to the labour cost advantage and the trainable workforce offered by these countries.

Sri Lanka has a long and proud history of boat building but during the recent past this industry was confined mainly to the manufacture of relatively small fishing crafts for the local market. However, during the past, the Government, private sector and other stakeholders have taken several initiatives to develop the boat building industry and as a result, the industry has now become a leading local industry as well as an emerging export sector during the last few years.

The Government has planned to make Sri Lanka a naval hub with the objective of exploiting the true potential of ocean and inland water resources for the development of the country as envisioned in the ‘Mahinda Chinthana – The Way Forward for Sri Lanka’.

The boat building industry of Sri Lanka with its untapped potential and the abundant water resources of the country can play an important role in achieving this objective.

“The EDB has identified the boat building industry as a priority sector with high export potential. Development of this industry will not only increase the foreign exchange earnings to the country, but also open up much-needed employment opportunities for boat builders both in Sri Lanka and abroad,” stated Janaka Ratnayake, Chairman and Chief Executive of the Export Development Board (EDB).

The EDB joined hands with the Boat Building Technology Institute (GTE) Ltd. (BTI) in organising the ‘Boat Show Sri Lanka’ as one of the main Government stakeholders, which was held very successfully twice in Sri Lanka, in 2008 and 2010.

This show opened up a new frontier of leisure boating, marine, industrial and commercial vessels. It was also able to introduce this trade to the local market and create a more sophisticated target audience.

Despite the global recession, the untapped boat building industry has become a major source of income for Sri Lanka where sales of boats to overseas buyers had grown from US$ 21.54 million in 2008 to more than double the amount in 2009 to US$ 57.81 million.

For the past 30 years this industry was working with an environment where two-thirds of the coastal belt was inaccessible and restrictions on use of high powered engines in boats specially leisure and pleasure crafts.

The barriers to the growth of this industry are slowly but steadily diminishing. This indeed is a very good sign for not only the existing entrepreneurs of boating industry but also for the new comers to invest in the industry and secure a good future for the industry.

Sri Lanka being an island is at a great advantage to become the hub for boat manufacturing in the Asian region due to its strategic location, highly trainable workforce and the labour cost advantage.

A trend is evolving in the Western boat market to run towards developing countries to manufacture Fibre Reinforced Plastic (FRP) popularly known as fibreglass, especially for hull construction. This is mainly due to the cost saving factor of manufacturing in developing countries. Another advantage is that the material base for boat building is also in the Asian region.

The boat building industry is a multi billion rupee industry and Sri Lanka should take full use of this emerging trend before losing the competitive advantage to other countries in the region. Therefore, the EDB has lined-up a number of activities for the development and promotion of this sector, where identifying new markets is one of the main activities in the export promotion agenda of the EDB.

“It is indeed a very appropriate time to undertake aggressive promotional campaigns in identified markets to create awareness internationally about Sri Lanka as a country of boat building,” said Ratnayake.

One of the identified venues for promotion is the Gulf Region through the ‘Dubai International Boat Show’ to be held from 1-5 March 2011 in Dubai. As Dubai is the regional gateway to the Gulf, foreigners frequently visit Dubai and their buying power is very high.

There is a huge leisure industry in the Middle East and the number of leisure marine boats in the Middle East is estimated to rise to 50,600 by 2012 and there are currently over 15,000 berths realised or under development in the Gulf Corporation Council (GCC).

Therefore, Dubai presents an ideal venue for Sri Lanka to commence its promotional activities to position and promote the boat building industry in the international market.