Exports earnings would drop by $7 bln this year
Sri Lanka’s total exports are to see a significant drop this year amounting to a US$7 billion loss in earnings with the revised targets set to achieve $10.75 billion in earnings.
This would mean Sri Lanka will see a drop of about 42 per cent of its targeted export volume which was previously forecasted at $18.5 billion. Compared to last year when Sri Lanka’s export earnings topped $16.2 billion, this year’s forecast would see a 33 per cent drop in value, Export Development Board (EDB) Chairman Prabash Subasinghe told the Business Times.
In this respect the EDB has revised its export target for merchandise segment to be approximately $7531 million and $3219 million for the services segment.
Commenting on job losses, he explained that this is certain to happen however, no figures of job losses have been calculated as yet.
With the apparel, rubber and gem and jewellery sectors particularly affected as a result of the outbreak of the coronavirus pandemic the global sales have reached zero level and the industries are struggling to survive.
The local rubber industry is adversely impacted since the global demand for solid tyres has been affected in addition to the new industries that commenced production like boat building, ornamental fish and certain electronic and electrical products, Mr. Subasinghe noted.
Government moves are underway to ensure the sustenance of the exports sector, he said adding that it is of paramount importance that the exports sector is a “national priority” right now.
With just about 10-15 per cent of the factories in all sectors currently operational, plans are underway to ensure that this needs to increase to at least 50 per cent, the EDB chairman said.
In this respect, even during curfew hours the government would ensure that workers would be allowed to travel to their respective workplaces to ensure continued production, he noted.
Mr. Subasinghe explained that factories would be advised to ensure they comply with the necessary Ministry of Health guidelines in resuming work and with the authorisation of the relevant Public Health Inspector of each area the factories would be made operational.
The EDB and the Board of Investment are authorised to inform the Police to issue curfew passes to these companies.
He noted that the biggest exports in seafood are carried out by air and these continue to be exported and exports continue to happen daily from Sri Lanka.
Currently the highest demand globally is for Personal Protective Equipment (PPE) for medical, food and beverage sectors and in this respect, the apparel sector could look at production in PPE, Mr. Subasinghe said.
In addition, the demand for soap and hand sanitizers could increase the production of these items.
Moreover, some of the agri foods and coconut-based products and other food items and certain petroleum products were likely to have just a marginal impact.
Mr. Subasinghe noted that conversely the agriculture exports was likely to increase due to the increased demand in food items globally.