Sri Lankan government to introduce new methods to attract investments and boost processed food exports

Sri Lankan government to introduce new methods to attract investments and boost processed food exports

A document on Sri Lanka’s export strategy has reportedly proposed that measures be taken to make it easier to import planting materials and fresh produce like coconuts, fruits and vegetables in order to attract investments and boost processed food exports.
“The supply of raw material must be secured in order for the sector to have the means to meet strong international demand and to upscale these industries,” the local media has quoted the document.
Accordingly, the Department of Agriculture is expected to amend quarantine laws by 2022 and simplify procedures to introduce and import high-yield seed crops in order to improve supply of fruits and vegetables for food processing.
“…a major issue affecting productivity as well as output quantity is the restriction on introduction of new varieties,” the strategy document has stated.
“Some Sri Lankan varieties have comparatively low productivity. For example, coconuts produced in Sri Lanka have a longer ripening period and are about half the size than those produced by major competitors such as Thailand.”
“In addition, some quarantine regulations are today obsolete and concern diseases that no longer pose a threat.”
According to the report, local crops are extremely vulnerable to weather conditions.
“Some of these weather conditions are seasonal and thus predictable. However, variations of weather conditions year-on-year have increased unpredictability and strongly affect the price of local raw material.
“As a result, local produce prices fluctuate much more than global market prices. Sri Lankan food processors have no mechanism to facilitate the replacement of their local raw material supply with imports during off-season periods,” the strategy document has added.
The proposed changes will allow food processing companies to import fresh inputs like coconut, fruits and vegetables whenever local supply falls.

OSL take:

The export sector is in the process of expanding its product portfolio and the government of Sri Lanka is looking at promoting the import of planting material and fresh produce, which in turn is expected to boost foreign investments to the country as well as improve the processed food export sector. Foreign businesses engaged in agriculture exports could look at opportunities in exporting goods to Sri Lanka. While local companies could look at developing the processed food industry and target the export market.

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Article Code : VBS/AT/20181009/Z_3

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