F&B sector can be a US$ 1 b industry for SL

Monday, 6 December 2010 00:35 - - {{hitsCtrl.values.hits}}

Sri Lanka focusing on the SME sector development with a Rs. 5,000 billion fund mobilising to wipe away all tax liabilities of enterprises below Rs. 100 million as at March 2009,

overall taxes coming down to 10% and ESC being exempted as per the Budget proposal of 2011 Sri Lanka is well poised to develop the Food and Beverage sector to be a US$ 1 billion industry, said the Head of National Portfolio Development for Sri Lanka and Maldives in the United Nations Office for project Services (UNOPS) Rohantha Athukorala.

Athukorala was delivering the key note address at the launch of the ‘Pro Foods/Pro Packs Exhibition 2011’ at Ramada Hotel, staged by the Sri Lanka Food Processors Association.

A key insight shared by the speaker was that the Food and Beverage sector was one key industry that was prevalent right across all provinces of the country. He highlighted the famous Nelli Crush company from Jaffna, which has the potential to be showcased to the world at ‘Pro Foods/Pro Pack 2011,’ which is to be staged in August 2011.

According to Athukorala, the F&B sector accounts for US$ 164 million of foreign exchange for Sri Lanka as at now and together with the key Budget proposal targeting this sector together with the setting up of the Knowledge City in each province as per Budget 2011, Athukorala – who is on the Industrial Strategy Task Force of the Ministry of Industry and Commerce – opined that business development services that had been the cry of the SME community would be addressed, adding weight to the US$ 1 billion claim that this industry could achieve in the near the future.

The speaker advised the association to not merely showcase the products and packaging at the 2011 exhibition but add value by differentiating the event by making a claim through propositions such as Rain Forest Alliance or Ethically-Manufactured Foods and Beverages from Sri Lanka so that with the supply chain development, Sri Lankan can claim a higher price from a global consumer.

Citing an example, he said that the apparel industry was holding on to share even with the exit of GSP+ so far due to the innovative solutions that the industry was offering the global buyer, which is exactly what the F&B sector must do given the research and development double deductions offered in the Budget, including incentives such as the 75% allowable limit of advertising, 100% of foreign travelling and training to be adjusted to calculating profits, which are drastic tax incentives that need to be factored, commented Athukorala.