Traditional export sectors ignored from stimulus

Wednesday, 25 March 2020 05:31 - - {{hitsCtrl.values.hits}}

Sri Lanka's export sector consists of mainly the apparel, tea, rubber, coconut, spices, fisheries and services sectors. Last week, the Government offered a stimulus package. However, this package excluded the traditional export sectors of tea, rubber, coconut, and agriculture. These sectors bring in $ 3 billion to the economy, create a large number of jobs at the SME level, and specifically support the rural agricultural economy.

When queried, Sri Lanka Association of Manufactures and Exporters of Rubber Products (SLAMERP) Director General Rohan Masakorala said that their sector, which brings in around $ 1 billion to the economy, has not yet been consulted or spoken to, whereas other sectors have already been spoken to by the Government. “We expect a downturn of about 40% in rubber exports this year, and a large number of SMEs are going to be affected through the supply chain. If our exporters are not given the proposed moratorium of six months for repayment of loans, and working capital loans at 4%, the impact could be even worse. Closure of operations will hit day-to-day wage earners of the sector, as companies will have to re-structure production. We have already got reports that tapping of rubber is slowing down. Things are not easy for the rubber industry, and we expect the Government to treat all exporters (direct and indirect) in a fair and an equitable manner, through a sustainable policy on the export sector,” he said.

“Our members have expressed disappointment, as the Government has failed to look at the traditional export sector. We have written to the Minister of Plantations and Industries to give their attention to these vital sectors of the economy, just as the other export industries,” he further said. “In fact, our industry is also supporting the Government by supplying medical gloves to the Ministry of Health to fight COVID-19,” Masakorala explained.

It was also understood that the tea, coconut, and spices industries, which employ a large number of Sri Lankans, have not received any clear direction from the Government, with the stimulus package offered to only a few sectors, including services sectors as well. All of the abovementioned sectors have expressed concern regarding the Government’s differential treatment of some export sectors, with these other sectors also having taken up the matter with the Export Development Board.