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Sri Lanka’s automotive component manufacturers optimistic about growth

Sri Lanka’s automotive component manufacturers optimistic about growth

Ada Derana: Automotive Component Manufacturers are optimistic about growth following the Covid-19 and Economic Crisis. President of the Sri Lanka Automotive Component Manufacturers Association (SLACMA), Dimantha Jayawardena said, “I guess the worst is over. Sri Lankan automotive component manufacturers have gone through the toughest business cycle from 2020 and through the current economic crisis.”
“Most manufacturers have survived,” he said. “Some are still trying to make the best following the temporary suspension of imported brands, while others are suffering due to low market demand as well as inability to source raw materials.”
In addition to being President of SLACMA, Dimantha Jayawardena is Chairman of the Automobile Sector Advisory Committee for Automobile Components Manufacturing & Assembly Related Industry – Ministry of Industries (MoI), and a Member of the Industrialisation Commission appointed by the President. He is also a member of the Board of Directors and Advisor to several companies.
Jayawardena said that the Ministry of Industries was able to help most of the manufacturers during the hardest times by the allocation of the Indian Credit Line to source raw materials. “It was extremely commendable that the Ministry of Industries took an initial step to help most of the manufacturers who were affected by the temporary suspension, by reviewing and lifting the restrictions following justification of the imports to the MoI. In addition, high interest rates have been severely impacting the industry, and many small-scale manufacturers had to wind up operations during the past year.” He said that the Sri Lanka Automotive Component Manufacturers’ Association has tried its best to support its members by getting involved in necessary interventions via the Ministry of Industries to safeguard the industry.
“As the industry tries to come out of the worst times, SLACMA is now in the process of getting its manufacturers certified by the International Automotive Task Force (IATF) to the 16949 international standard. This endeavour is 50% funded by the Ministry of Industries. SLACMA will also work with financial institutions to obtain their support for small manufacturers to secure loans to upgrade factories and machinery, in order to increase the quality standards and be more competitive in the global supply chains.”
The short-term plan of SLACMA is to work with regional and local counterparts to support JVs and technical collaborations, as it will help the local manufacturers to enter global supply chains much faster, he said. “As the worst is over, there is a bright future for the local manufacturers with the opportunities in the local and export markets with the current earnings being around USD 200 million per year. The 10-year plan of the Ministry of Industries, the Export Development Board and BOI is to achieve USD 1 Billion through exports from this sector. We are confident that this can be achieved.”

OSL take:

The sentiments expressed by the Automotive Component Manufacturers is indicative of the overall performance of Sri Lanka’s economy. Following the global pandemic and the economic crisis that followed it, the country’s economy is once again on the growth path. It is important to note that Sri Lanka’s economy has shown great resilience through the years and has always faced adverse times with great hope. The country’s geographical positioning in the Indian Ocean and the many trade agreements as well as trade concessions enjoyed by the country have also helped Sri Lanka’s economic recovery. However, with plans to becoming an emerging business destination in the South Asian region, Sri Lanka is currently showing signs of growth and business potential. Foreign businesses/investors could therefore confidently explore the growing opportunities in Sri Lanka, especially in the manufacturing sector.

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Article Code : VBS/AT/20230626/Z_8

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