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Lanka to be $100b economy by 2020 - Dr. P.B. Jayasundera

Sri Lanka will be a US$ 100 billion economy earning five billion US dollars in tea exports by 2020 despite the sluggish global business environment, said Treasury Secretary Dr. P.B. Jayasundera. He was addressing the 118th AGM of the Colombo Tea Traders Association (CTTA) on Friday.

Dr. Jayasundera said Sri Lanka has crossed many critical milestones such as defeating terrorism and achieving economic prosperity within a short span.

The Per Capita Income (PCI) of the country has crossed US$ 2,000 today from US$ 1,000 in 2005. The PCI will cross US$ 3,000 by the end of this year.

"We must have an open mind and be optimistic instead of being pessimistic. Five billion dollars is an ambitious target.

Sound marketing strategies and enhancing the quality of production will help boost exports and bring us ahead of competitors", he said.

CTTA Chairman Jayantha Keragala said that achieving five billion US dollars in export revenue is an ambition or near impossible target given poor promotion, inadequate subsidies, labour issues and the global economic crisis.

The tea industry is facing several storms that have impeded the growth of the sector. Production and export competion have weakened due to the high cost of production and inadequate funds for promotional activities.

The industry solicits the support of the Government to boost exports and retain the status of the industry in the global market", Keragala said. He said unlike competing countries which have cheap labour and low production costs the Sri Lankan tea industry has a huge production cost due to the high labour and energy costs which are a burden on the industry.

Dr. Jayasundera said that growth in India and China has slowed despite the countries being the two power houses in Asia.

China is the second largest economy in the world and has successfully brought its spacecraft to earth this week.

"It is a tough time for all countries and Sri Lanka has to respond with corrections. High oil prices, exchange rate, bank interest rates and subsidies need to be addressed," he said.

"Sri Lanka has a great advantage due to infrastructure facilities such as electricity, good road network and communication which many regional tea exporters do not have.

We need to be innovative with good cultivation practices and enhancing the value addition to be ahead of competitors", Dr. Jayasundera said.

Sri Lanka's position in tea production and exports has dropped from third largest producer to fourth and second largest exporter to third. Dr. Jayasundera said that the Government is optimistic that Sri Lanka will be an upper middle-income earning country by 2014 and added that tea exports should target US$ 2.5 billion by that time and then reach the target within the next few years.

The Export Development Board has set a target of US$ 20 billion by 2020.

 

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