Untitled Document

Business

Imports adversely affect used local newspaper trade
By Naomi Gunasekara
Central Road in Pettah bustles with activity at mid-morning. "Naataamis" (labourers) unload stacks of old newspaper from wooden handcarts while shop owners light joss sticks to invoke the blessings of the Gods before starting their daily transactions. Muddy, betel-stained paths leading to shop entrances are sprinkled with saffron water and strings of lime and chillie pulled across doorsteps are readjusted.
Oblivious to the banal activity around him, P. Jeyaram orders his three workers to gather stacks of old newspapers into 25-kilo bundles to be sent out of Colombo. Two of them squat on the pavement sorting the papers and bundling them while the other, seated on a rusty iron stool, weighs the bundles.

Having been in the newspaper trade since 1974, first as a 14-year-old worker at P. M. Mohideen and Co and then as partner of S. P. Traders formed by his brother and himself, Jeyaram believes in starting business early. Dressed in a blue sarong folded up to his knees and a matching blue shirt, Jeyaram placed himself before a narrow wooden desk watching his workers while he spoke of his business. Established in 1985, S. P. Traders sells local newspapers collected from newspaper companies and homes. While most of their papers come from newspaper companies, a substantial amount is collected through "bothal-paththara karayas" who go from door to door buying old newspapers.

Enough papers
"We have enough papers to meet the needs of the paper market, but sales have dropped because of paper imports," he tells me with a forlorn look. While individual newspaper companies pump over 50,000 kilos of newspaper into the market, the import of paper has decreased prices and the demand for local newspapers. Sales, however, catch up during Christmas and "Avurudhu" but bring little income during the rest of the year.

Over 150,000 tonnes of local newspapers reach the market every month and these papers had a very good demand before imported papers took over the paper market. Is it only large-scale paper imports that affect the paper market? What about the use of polythene bags? I ask him. "Our market is not the Colombo market," he replied. "We sell papers in the outstations where the rural folk still wrap their daily sugar or onions in a piece of paper."

S. P. Traders sells most of its newspapers to wholesale shops that sell onions and potatoes at Fourth and Fifth Cross Street. These sales are done in 25-kilo bundles and Jeyaram employs people to bundle and sort newspapers that reach him through newspaper companies and individual collectors.

Business poor
The shops down Fourth and Fifth Cross Street not only buy papers from Jeyaram but also help him deliver them by distributing them in areas like Kalmunai, Batticaloa, Galle, Matara, Balangoda and Galenbindunuwewa. "Sometimes small scale shop owners ask for papers and settle the bills at the end of the month. We send them in onion lorries because we don't mind anything as long as the papers are sold. Business is poor."

Comparing his income at the outset with the present, he said; "We don't have a profit now because imported papers are cheaper." Imports do not cost much, according to Jeyaram, as the big mudalalis get most of their papers free or at a very low cost. "The market prices fall because of this and we are not at all happy with paper imports."

However, importer S. Shanmugaraja has a different story to tell. His shop at Old Moor Street is full of bundled paper. Yellow, blue and green tags separate 20 and 25-kilo paper bundles consisting of papers from the Persian Gulf like Khaleej Times and The Gulf Today. Unlike his counterpart Jeyaram on the adjacent street, Shanmugaraja does not have an old office with rickety tables. And his workers are full of life, not looking glum.

His papers come from Singapore and Dubai and are used to wrap lunch packets and grocery, he tells me. I ask him if there is a need to import newspapers. "The demand for papers in Sri Lanka cannot be met with the local supply so we have to import papers," he assures me.

Environmentally friendly
The best thing about paper is that it is environmentally friendly and can be recycled. If used paper can be recycled, then there may not be a need to import papers, he says. Shanmugaraja feels that it is time to establish a recycling factory in Sri Lanka and encourage people to use paper instead of polythene. "Otherwise we will have to continue with imports to meet the local paper demand," he said.

eople from as far as Hatton, Bandarawela, Badulla, Batticaloa and Vavuniya come to Shanmugaraja for papers and his business is booming because people buy more and more imported papers for packing today. "The government should think about the environment and ban the use of polythene bags as in Singapore. This will help the paper industry immensely. But banning the import of papers is not going to help the industry at all because it is the imports that maintain the balance between demand and supply."

he market for imported papers has become strong today, says an employee of a small newspaper shop down Central Road, who feels that it is the quality of imported papers that attract the consumer. Tying a bundle of newspapers, he turns his blackened palms up. "Look at my palms," he says. "The ink comes off our papers and it could mix with food. Some people prefer foreign newspapers because the ink does not come off."

While dealers in old newspapers argue that imports affect the market and create a surplus thereby reducing paper prices, importers argue that it is imports that maintain a balance between demand and supply. However, the newspaper industry feels that imports affect the local market because they are cheaper. "We used to sell a kilo at Rs. 28 before this import business started and now we sell at Rs. 11. I don't think the government will be able to ban imports but a tax on imports will definitely solve the problem," an industry official said.

Back to Business