9 June 2022 04:19 am Views - 317
The local export sector reiterated the need for Sri Lanka to have “robust” policies to continue its operations in the local market and sustain in the global markets.
In an effort to ensure the foreign exchange fetching sector is given due emphasis, the National Chamber of Exporters (NCE) met with Prime Minister Ranil Wickremesinghe recently to share their concerns and grievances, alongside presenting a set of proposals that could help ease the issues faced during the ongoing crisis.
“Sri Lanka simply cannot allow this vital sector to collapse due to the prevailing economic crisis,” said NCE Secretary General and Chief Executive Officer Shiham Marikar, in a statement on behalf of the export community.
In the set of proposals shared with Wickremesinghe, the first request made was to ensure uninterrupted power and fuel supply to exporters. While urging the authorities to consider imposing the power cuts after 4:00 p.m., the NCE requested to allow fuel purchasing into large barrels for industrial use and to streamline the fuel distribution at central points or depots.
The call to impose a mandatory ruling for exporters to remit export proceeds to the country within 180 days was emphasised once again. It was also proposed to streamline the mechanism for exporters to use export proceeds to import raw materials required for the production.
As exporters are struggling to reach newer and non-traditional markets, one of the proposals to Wickremesinghe was to direct all foreign missions to appoint commercial officers to promote exports and to generate monthly reports on the progress.
To support the SME sector and to help them expand their ventures, the chamber urged Wickremesinghe to establish a concession scheme via Sri Lanka Export Credit Insurance Corporation (SLECIC) to limit the risks of defaults.
Emphasis was also made on the special loans that were given during the COVID-19 pandemic to be rescheduled, as the export enterprises are finding difficulties in debt repayment, due to the prevailing situation in the country as well as the world economy.
The NCE has proposed to the Finance Ministry to provide relief measures to the SME exporters affected by the present situation, some of which include providing additional and or new working capital requirements at 3-4 percent interest at least for a period of 12 months under a new debt moratorium, rescheduling non-performing loans, extending debt moratorium assistance for lease and overdraft facilities obtained by SME exporters and rescheduling special loans that were given during the COVID-19 pandemic.
With the shortage of forex in the county impacting the importation of raw materials, the chamber suggested allowing export enterprises to sell 50 percent or more of their production capacity locally, to buy dollars from exporters to import raw materials.
The proposals also highlighted the inability to sell products in international e-commerce platforms, due to restrictions enforced by the government on online fund transfer methods such as PayPal.
It was proposed to remove restrictions enforced on receiving funds through international payment platforms such as PayPal to encourage local medium and small enterprises to enter into international markets.
Among other proposals, the NCE urged the authorities and policymakers connected to trade to consult exporters/trade chambers on export-related matters before making decisions.
“The common understanding and agreement will increase the country’s exports and export earnings. Independent and arbitrary decisions slowdown exports and negatively impact trade,” said Marikar.