Sri Lanka aims to boost manufacturing sector’s GDP contribution to 20% by 2030
Daily FT: The Industry Ministry has set ambitious targets to elevate the manufacturing sector’s contribution to the national GDP from 16% to 20% by the year 2030. This strategic initiative is part of a comprehensive plan outlined in the National Industry Policy and a five-year strategic roadmap spanning 2023-2027.
Industry Ministry Secretary Shantha Weerasinghe detailed these goals during a press briefing held at the Presidential Media Centre (PMC) recently.
He highlighted the crucial role of entrepreneurship, aiming to increase its share in the workforce from 2.8% to 7%.
“To achieve these objectives, the Ministry has already submitted the detailed five-year strategic plan for 2023-2027 to the Department of National Planning,” he added.
Weerasinghe underscored the Ministry’s proactive role in steering economic revival, particularly through navigating past economic challenges.
Key legislative efforts complement this strategic thrust, including the final Bill to amend the Industrial Promotion Act, currently under review by the Attorney General’s Department. This amendment is designed to address current and future industrial needs effectively.
The Ministry has introduced a Standard Operating Procedure (SOP) outlining guidelines and regulatory procedures, notably introducing the “Local Value Addition Theory” for local vehicle assembly.
A significant stride towards enhancing industrial infrastructure includes the introduction of an online registration system for manufacturing industries, resulting in the registration of 3,925 industries by June 2024.
The Industry Ministry has introduced a registration system for manufacturing industries, with 3,925 industries registered by June 2024. Industry registration is now available online, allowing for global access.
Under the initiative to enhance leadership and entrepreneurship in small and medium scale enterprises, the Revolving Fund Loan scheme has allocated Rs. 293.4 million for 33 projects in 2022. For 2023, Rs. 1, 753 million has been provided for 176 projects through 10 institutions (banks). “So far in 2024, Rs. 1,647 million has been allocated for 179 projects,” he said.
Under the environment-friendly project, the revolving fund loan scheme allocated Rs. 293.4 million for 33 projects in 2022 and Rs. 155 million for 7 projects through 11 participating lending institutions (banks) in 2023. A total of Rs. 256 million has been provided for 15 projects so far during the year.
OSL take:
Sri Lanka’s manufacturing sector has shown a growth momentum through the years, even during the economic crisis faced by the country during the past few years. It is a clear indication of the resilience and the growing business potential in Sri Lanka’s manufacturing sector. It is this reason that has made the Sri Lankan government to set higher targets for the manufacturing sector while also presenting incentive schemes to attract more investments to the sector. Sri Lanka’s plan to set up more investment zones in the country while further strengthening the country’s trade ties with other countries would give a further boost to the manufacturing sector. With Sri Lanka working towards becoming a hub in the South Asian region, the business/investment opportunities in the manufacturing sector would see further growth. The growth and profits recorded by local businesses engaged in the manufacturing sector indicates the lucrative nature of the business. Foreign businesses/investors could therefore confidently explore the expanding business/investment opportunities in Sri Lanka’s manufacturing sector. They could also look at forming collaborations with local businesses in the manufacturing sector to further expand operations locally and internationally.