Common man doesn’t want to see country jumping from the frying pan into the fire, says EDB chief

By Sanath Nanayakkare

The common man doesn’t want to see the country jumping from the frying pan into the fire, so whatever we do, it needs wider consensus among the public, normalized behavior and intelligent thinking, Suresh Dayanath de Mel, chairman and Chief Executive, Sri Lanka Export Development Board said during an exclusive interview with The Island Financial Review yesterday.

Excerpts from the interview with the EDB chief:
“Despite the ongoing crisis, Sri Lankan exporters have been very resilient. The export market is very good. The orders are steady. However, we are concerned that the persistent negative publicity about Sri Lanka in the foreign media could tarnish our international image. Our buyers overseas are getting anxious whether Sri Lankan exporters will be able to deliver their orders with the same firmness as they did before. This is a great concern for the EDB and all businesses that bring in foreign exchange to the country.

“We have been able to sort out the fuel shortage faced by the exporters because they pay in US dollars. The Ceylon Petroleum Corporation (CPC) and Lanka IOC both deliver fuel to exporters. The challenge here is, these institutions issue fuel to us in browser loads. So it’s difficult for small and medium enterprises (SMEs) to store fuel due to lack of storage facilities. They are getting fuel in the normal way by waiting in queues with other vehicles at filling stations across the country. So, a number of SMEs are going to be affected by this situation because they don’t have storage facilities, therefore, we are encouraging SMEs to come together, buy a bowser load of fuel and then share it among them. That’s happening now. Up to now, many exporters have managed the fuel crisis well. But honestly, some of them are struggling to find fuel for their operations. Last week was a bit of a mess. The logistics sector also experienced the shortage of fuel which was also sorted out. With all that said, the good news is; Sri Lanka’s export trade remains resilient with US$ 6 billion of export earnings in the first-half of the year.”

When asked about the current social unrest, he said,” Anything we do, shouldn’t be radical in a negative way. Most importantly, a peaceful transition of administration needs to happen in a non-violent manner and it needs to happen as quickly as possible because exporters need a government which has the capacity to solve the economic crisis. Shortage of fuel, LP gas, food, medicine etc. occurred with the depletion of our foreign exchange reserves. So we have to restore political stability to address the economic crisis. Exporters earn foreign exchange for the country and the right conditions need to be created soon to facilitate their operations.”

When asked about the IMF programme, he said, “An extended fund facility programme from the IMF will be favourable for Sri Lanka to regain confidence of the international financial markets and that will be a boon to the export sector as well. There are some citizens who think that we can do without the IMF. I think we should be able convince them that we need assistance from the IMF, increased export earnings and other fiscal consolidation moves, to put the economy back on track and shift it to a growth path subsequently. The thing is, if the country continues to project a negative outlook in the foreign media, our buyers will lose confidence in our ability to deliver in time and it could have repercussions on our export trade.”

He went on to mention that there have been some export order cancellations.

“However, in most cases, our overseas buyers have been watching the situation in Sri Lanka with patience. They follow each and every news alert on Sri Lanka hoping that we will get over the crisis as a collective nation and get back to normalcy rather quickly. So we need to project the image and perception to the world that we are stabilizing. If the current situation persists, they may run out of patience and decide that they can no longer depend on Sri Lanka as a reliable supplier and exporter. We all know that Sri Lanka has successfully emerged from its previous crises such as its protracted war in the North, tsunami, Easter Sunday attack and Covid-19 pandemic, during which our exporters showed great resilience and their ability to deliver the goods. We need to keep in mind that our exporters are operating in a highly competitive global business environment today. Buyers have access to alternative exporters in other countries. This is true for all sectors in the export trade. For example, the apparel sector is receiving new orders around this time of the year and we shouldn’t let that business go elsewhere. That’s a concern for us. Not only apparel, all other sectors in the export trade may face a similar situation. Another example is; agri products portfolio in our export basket is growing and we have to ensure that it accelerates its expansion momentum”.

Responding to a question on political stability, the EDB chief said, “Whatever we do, we need consensus from the wider public. Protestors also now have to normalize and be seen as intelligent. If they become violent, then people won’t tolerate that because at the end of the day the common man is watching. They want to see that the country doesn’t jump from the frying pan into the fire.”