Canned fish manufacturers fear collapse of industry amidst free flowing imports

By Nishel Fernando
Sri Lanka’s canned fish manufacturers fear imminent collapse of the industry amidst free flow canned fish imports into the country despite the temporary import suspension announced by the Ministry of Fisheries.   
Early this year, Minister of Fisheries Douglas Devananda instructed the Director General of Fisheries Department Susantha Kahawaththa to suspend the issuance of prior-approvals temporarily, for the import of canned fish with effect from 11th of January this year. 
However, 4.5 million canned fish tins have been imported in to the country during the first six months of the year, according to the Canned Fish Manufacturing Association of Sri Lanka urged (CFMASL). In particular, Sri Lanka Custom data showed over two million canned fish tins imports in April this year.
Amidst higher taxes imposed on locally produced canned fish, CFMASL President Shiran Fernando lamented that local producers cannot compete with cheap and largely unregulated canned fish imports dumped into the country. 
According to him, each locally produced canned fish tin is subjected to 20 percent tax including 18 percent VAT, while only Rs.200 tax is imposed on one kilo of  imported canned fish which is equivalent to two and half canned fish tins. 

As a result of this unfair taxation, CFMASL General Secretary Kapila Balasuriya revealed that local canned fish manufacturers have been forced to halve their production by over 50 percent while cutting down the workforce from over 3000 to 1000-1500 at present. 
Meanwhile, Fernando noted that the main reason for the failure in implementing the ban on canned fish imports was the lack of cooperation of government agencies such as Sri Lanka Customs (SLC).
“As per our knowledge, Ministry of Fisheries issue licenses without specifying amounts, and it’s valid for a 1-year period, so what we assume is that current canned fish imports come under these already issued licenses, that’s why it’s important the other government agencies such as Sri Lanka Customs (SLC) cooperate with the Fisheries Ministry to effectively implement this ban,” he said. 
As domestic canned fish manufacturers have the capacity to meet the demand for canned fish in Sri Lanka, Fernando urged the government to impose a permanent ban on canned fish imports. 
As canned fish manufactures purchase the excess local fish production at attractive prices, he stressed that a possible collapse of the canned fish industry tends to jeopardize the livelihoods of over one million people. 
The local canned fish industry grew steadily during the pandemic and at height of economic crisis. It has saved US$ 100 million annually to the economy as an import substitution. Currently, there are 16 canned fish manufacturing plants in the country.