Country on track to achieve 7.5 percent growth

By Sanjeevi Jayasuriya

The export sector needs to concentrate more on diversification and sophistication to be competitive in the foreign market.

“Sri Lanka achieved an economic growth of 6.4 percent in 2012 which is remarkable by any standard considering the sluggish growth rates recorded by the rest of the world,” said newly elected Chairman of the Exporters Association (EASL), Rohan P. Daluwatte at the 16th AGM of EASL in Colombo recently.

“According to Central Bank sources, the economy recorded a growth of 6 percent in the first quarter 2013 and it is said that the country is on track to achieve the projected 7.5 percent growth rate for 2013,” he said.“We need to have a paradigm shift from what we are doing now. As a country, we need to add value to products and services with branding of products to develop products for the niche market which in turn will give higher returns,” Daluwatte said.

It is necessary to move away from traditional markets to emerging markets in Asia, which is expected to grow about 6 percent and offers a huge potential.

The country should move away from primary export and simple manufacturing to more sophisticated exports to achieve higher growth levels, he said.Sri Lanka has entered into several bi-lateral and multi-lateral trade agreements with countries in the region.

However, many of them are heavily underused. Greater regional integration will help Sri Lanka to capitalise on Asia, while product diversification and sophistication would give larger market share. To move forward we also need to empower human capital by investing in education and technology, he said.

In 2012, four years after the onset of the global financial crisis, global economic growth weakened further, pushing several advanced economies into double dip recession. Sri Lanka has seen a weakening of its export to GDP ratio, falling to a low of 17 percent in 2012.

This clearly indicates a declining share of the global export market. Export earnings contracted by 7.4 percent and further continued to contract by 6.6 percent year-on-year during the first five months of 2013.