EconomyNext – The Exporters’ Association of Sri Lanka (EASL) has urged the new government to set an Export-Import Bank and other measures to provide special support to exports, warning that delays were forcing many firms to look overseas.
The Association, in a statement, commended the government’s plan to restore good governance in the country while taking steps to promote economic growth.
"The EASL does however expect that the government will take steps to eliminate some of the barriers and deficiencies the sector faces towards boosting exports," it added, noting that the association has continuously lobbied on several matters of importance to exporters.
"A matter of particular concern at this point in time is the frustration of domestic companies engaged in exports, which appears to be compelling them to either relocate their businesses abroad, or consider the expansion of their current operations overseas," it warned.
"There is an urgency to implement the policy framework to sustain investment already made in order to expand on its valued foundation."
The EASL said the "long-awaited" setting up of an EXIM bank which will support exporters looking at new markets and the need to expand the scope of Sri Lanka Export Credit Insurance Corporation will encourage diversifying of markets and exports by the SME sector.
Sri Lanka already has several banks and any other state bank that gives special support below market rates at tax payer cost to any industry will increase the burden of the state on domestic citizens, analysts warn.
Manufactured goods exporters have enjoyed lower tarriffs on electricity for years at the expense of higher tarriffs on households and the non-traded sector, though service exporters such as IT were not a burden on the poor, analysts say.
However with coal plants being built, Sri Lanka has the chance to reduce power tariffs to levels seen in other East Asian nations.