High labour shortage in EPZs impedes operations

4 July 2014 05:22 am Views - 2248

Minister rules out importing labour

By Dilina Kulathunga
There are as much as 15,000 vacancies in the country’s Export Processing Zones (EPZs), and this high dearth of labour is hampering the operations of factories located in them, Investment Promotion Minister Lakshman Yapa Abeywardena said.

“In recent times, severe labour shortfalls in the EPZs in Katunayake, Biyagama, Koggala, Seethawaka have been noted. At the moment there are at least 15,000 vacancies.”

He attributed the reluctance and/or uneasy access to these locations, government’s creation of jobs for graduates and the Korea effect where large number of skilled labour being lost to South Korean job quota, as main reasons for this problem.

Addressing the media at his ministry, he said some of the employees who had been working at these zones have left to join the government sector, aggravating the situation.

Meanwhile, the country’s unemployment rate has also dropped to a historical low of 4.2 percent, which is deemed as near full employment by some scholars.

When queried if the government will allow to import labour in areas where substitutes could not be found locally, Minister Yapa completely ruled out such possibilities.
“We will not allow that (labour importation) under any circumstance,” he stressed.

Nevertheless, he noted that the government would allow the Indians to come and work in Sri Lanka only in industries where heavy equipment handling is required. “For instance, for the Dockyard (Colombo Dockyard PLC) and other industries where heavy metal is handled, and where Sri Lankans cannot operate in such heat, we have allowed Indians to come in,” he added.

Apart from that, the government will also allow a maximum of 20 foreigners to come in under Strategic Development Projects, only in areas where skills could not be found locally.

However, he noted that it would also be restricted to the amount of quota allocated and only the replacements would be filled.

The Comprehensive Economic Partnership Arrangement (CEPA) between India and Sri Lanka remains in limbo due to fears that the agreement will open flood gates of cheap Indian labour into the country among others.

In Sri Lanka, labour shortage is not confined only to EPZs but is rampant in many other specialized sectors such as banking, Insurance and IT and BPO.

Availability of labour becomes new priority for IPZs In a strategic move, the government has decided to set up new Industrial Processing Zones (IPZs) in remote parts of the country where industrialists will have easy access to abundance of labour. To this effect, the Invest Promotion Minister has presented a cabinet paper proposing an IPZ in Puttalam which has land to the extent of 250 acres.   Meanwhile another three IPZs in the Hambantota district – Sooriyawewa, Mirijjawila and Bollagaswewa are currently being planned.  Two IPZs in the Matara district –Mawarala and Hakmana are also in the pipeline.  The President has instructed the Ministry to establish at least five IPZs for a district. An IPZ has already been established in Vavuniya, and Kilinochchi has been earmarked as a potential district for another one. Speaking on the progress achieved to-date, in Mirijjawela IPZ which has a total area of 228 hectares, Minister Yapa said they had received applications for 42 new projects and the lands have also been allocated based on government estimates. “One such project is already underway,” he noted. The lands have been allocated under 50-year lease with a US $ 1,000 premium during the initial three years increasing to US $ 10,000 thereon. The annual ground rental is US $ 3,850. After the Rathupaswala incident last year, which cost two lives, potentially hazardous industrial factories are now being re-located inside IPZs under President’s instructions.