Minister of primary industries Daya Gamage says progress in recent years has resulted in Sri Lanka becoming a more competitive player in the global export market.
That is especially so, as we are now exporting value-added products as opposed to only raw material, he says.
“We plan to concentrate on high-tech and quality products to the international market to maintain Sri Lanka’s reputation of the country through branded products such as Ceylon Sapphire, Ceylon Tea and Ceylon Cinnamon.”
He was addressing a Nepal Sri Lanka Business Forum at Hotel Taj Samudra in Colombo yesterday (11).
Text of the speech:
It is my pleasure to be here today to address this business gathering.
First, let me warmly welcome you on behalf of the Ministry of Primary Industries to this business forum. This event is one of the many successful efforts of our newly appointed Nepalese Ambassador, with whom I have had several enlightening conversations with at great length. Let me start by warmly welcoming him and also thanking him for the time taken to speak to me as well as the initiative taken on his part to interact and start a productive dialogue between our two countries.
My own ministry, the Ministry of Primary Industries, is working toward development of industries to enhance Sri Lanka’s export market – by focusing specifically on bringing new investors, we hope to create new enterprises to promote our country’s exports. As the Minister of Primary Industries of Sri Lanka, I have the responsibility of directing the Sri Lankan industries involved in the extraction, collection, exploitation and commoditization of natural resources such as Agriculture, Forestry, Fisheries and Mining. The current government has made this a top priority and in order to achieve this goal, we must make the process of investing in Sri Lanka as well as investment by Sri Lankans as simple as possible.
Aside from the friendly and hard-working nature of our peoples, Nepal and Sri Lanka have a great deal in common. Like us, their GDP is reliant on the remittances of foreign workers and agriculture is a significant component of their economic activity.
The main point in which I want to discuss our similarity is on our shared high trade deficits. Not only do we have to increase our external trade to other nations, we also have to increase the level of trade between ourselves. In 2016, trade between Sri Lanka and Nepal amounted to only $ 1.4mn.
Nepal has many potential industries in which they can expand their external trade. As an example, the export-oriented carpet and garment industries have grown rapidly in recent years and together now account for approximately 70% of merchandise exports – I am confident in this being an industry that will help to bring down the trade deficit of Nepal. Similar to this example. Both Sri Lanka and Nepal have to invest and expand in other potential industries with comparative advantage. Some of these industries include garment exports and agriculture exports such as fruits, vegetables and rice wheat. The European Union as well as the newly exited UK are the largest buyers in these areas and there must be a focus on continuing to capture these markets.
Both Sri Lanka and Nepal have another industry unique to us that we have yet to fully tap into. The world indigenous market size is $107bn and the herbal plants that are naturally occurring in our countries are in high global demand because of the health benefits and medicines that can be developed from them. I am positive that both countries can increase our contribution to this and achieve a combined target of $200mn by 2020, with the proper investment and attention. In this matter, If the Nepal government requires technological support from us in terms of developing this sector, I will gladly pledge my support towards the development and promotion of indigenous sector in Nepal, as I have in Sri Lanka already.
Religious tourism is another sector we can grow, both by promoting between ourselves and a combined from to the world. As the birthplace of Lord Buddha, Nepal holds great significance to Sri Lanka, a predominantly Buddhist nation. The rich Buddhist culture and natural heritage makes both countries attractive tourist destinations, an industry that is showing continuous growth – Sri Lanka has already recorded a 6.1% increase during the 1st quarter of 2017.
In terms of Sri Lanka’s exports, I am pleased to note the progress in recent years has resulted in Sri Lanka becoming a more competitive player in the global export market, especially as we are now exporting value-added products as opposed to only raw material. We plan to concentrate on high-tech and quality products to the international market to maintain Sri Lanka’s reputation of the country through branded products such as Ceylon Sapphire, Ceylon Tea and Ceylon Cinnamon. As we have found, branding, packaging and marketing are the most effective tools for ensuring high value for agriculture products, a strategy Nepal can also follow.
Furthermore, we have also focused on regional free trade agreements with close neighbours such as India, China and Singapore, our GSP plus scheme to the EU and also taking advantage of our strategic location within China’s Silk Road initiative. In April of this year, our exports had increased by 11 % (US$ 795Mn) , with industrial exports growing by 8.6%, tea by 17%, Spices by 78% and Seafood by 59%.
In previous years, we were unable to fully utilise our competitive advantage due to inadequate supply and poor quality standards – my Ministry has initiated many programmes to move from traditional agriculture to industrial agriculture, investing in technology transfer to the agriculture sector. Our new “Agriculture Sector Modernisation Project”, in collaboration with the World Bank, is thereby focusing on Value Chain Development and transforming agriculture to industrial agriculture in the country’s quest for broader development.
I would like to commend Nepal for also recoginising their competitive advantage in the mines and minerals sector and I urge prospective investors to invest in this sector. The Nepalese government has made many reforms and related laws to make that sector investment friendly. Many regions are unexplored when it comes to mines and minerals. Nepal’s mining history dates their King Prithivi Narayan Shah which means they have many ancient mining techniques. Nepal needs to adapt new technologies, techniques and equipment in order to develop and industrialize the mining sector. This type of sector development plays a vital role in industrial development and employment generation whilst minimizing dependencies on foreign goods and services.
At the Nepal Investment Summit in Katmandu in March of this year that I attended, many Sri Lankans expressed an interest in investing in Nepal, to the approximate figure of $500 mn. I would like to take a brief moment to thank Professor Bishwambher Pyakuryal for inviting me as a representative of the Government of Sri Lanka for this event.
If this list of prospective investors can be provided to me, I am ready and willing to help facilitate this investment to further strengthen economic ties between Sri Lanka and Nepal and spread the benefit that this investment would result in for both nations. We need not look further than The Chowdry Group, whose hotel we are are in today, as supreme example of how investment and friendship has resulted in advantages for both Sri Lanka and Nepal. Aside from the Taj Samudra, the Group owns 12 hotels in Sri Lanka – with plans to expand further into the tourism industry. Similarly, investment opportunities exist for Sri Lankans in Nepal – they need to only be given the support. Both of our countries need more foreign exchange to narrow down the gap in the balance of payment. In this regard, we have to look into ways of increasing the foreign exchange earnings products & service sector.
I therefore request from the members and participants of this business forum to thereby look into avenues to expand trade between our two countries and develop long term business relationship, in order to be more competitive in the external trade.
I wish success to you all and hope this forum will be one of many that open up and facilitate increased bilateral trade between both countries in the future.