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USAID funds to boost exports

2014 Jul 09

Just days after the USAID withdrew funding for elections awareness programme in Sri Lanka under controversial circumstances, the country's Export Development Board (EDB) said the donor agency of the US Government was funding a programme to develop a strategic plan to boost export earnings, which have been falling as a percentage of GDP for over a decade.

The Economic Association of Sri Lanka, think tanks such as the Institute of Policy Studies and Verité Research, and multilateral agencies such as the International Monetary Fund (IMF), have been calling a for a significant boost in export earnings, together with FDI, which would help the country breakaway from debt driven government spending led economic growth, which was not sustainable.

"We are launching the first step of EDB's Strategic Plan creation, which aims to achieve US$ 20 billion by 2020. We all know that our national target is US$ 20 billion by 2020 but there is a big mismatch. Our current export strategic plan ends in 2015 and there is a strategy from 2015-2020," said EDB Chairman/CEO Bandula Egodage.  He was addressing the project kick-off team meeting of the formulation of the latest EDB Corporate Plan/Strategic Plan with the assistance of USAID VEGA Facilitating Economic Growth in Sri Lanka (VEGA FEG SL) Project, at the EDB auditorium on 1 July. Also present on the occasion were the selected consultancy team of Bahrain-based MTI Consulting led by its CEO Hilmy Cader, Sujatha Weerakoone (DG-EDB), Dr. Yousuf Maraikkar (ED-EDB), and various directors and top personnel of export product sectors as well as many heads of EDB departments.

"EDB, realizing the need for the service of a consultant who is highly knowledgeable and well conversant with the export development process to formulate its corporate plan/strategic plan, sought the support of USAID VEGA Facilitating Economic Growth in Sri Lanka Project (VEGA FEG SL). USAID agreed to provide technical and financial assistance to formulate the Corporate Plan/Strategic Plan 2015-2020 for the EDB. Accordingly, with the concurrence of the Minister of Industry and Commerce Rishad Bathiudeen and the EDB, the team headed by Hilmy Cader from Bahrain based MTI Consulting was selected by VEGA FEG Project for the consultancy. The consultancy fee is to be borne by the VEGA-FEG SL Project of USAID," the EDB said in a statement.
Export earnings grew 6.7% from a year ago to US$ 11.1 billion in 2013.

MTI CEO Cader said: "Synergy is most important, else the strategic plan will end up in yet another filing cabinet. EDB is performing a key role in the country's national profit and loss account; in that, by taking on the challenging 'income side' of it. Exports are the lifeblood of the country. We have great products and with enhanced marketing, we can achieve more.

"The objective of our exercise is to provide the strategic direction for EDB to increase the country's exports value to US$ 20 billion by 2020 and contribute to achieve the   overnment's development objective. In this regard, value addition is absolutely crucial and for that we need to have the supply chains in place. MTI will be using its 'Analyze, Strategize, Realize' methodology to map the export strategy — we need to remember that Sri Lanka's export levels are dependent on derived demand.
"Therefore, towards achieving the US$ 20 billion target, there are two key actions that EDB has to take-first being the safeguarding of the current export levels of US$ 11 billion and then the other action being, to go to US$ 20 billion from this level.

"The usual export activities or strategy of the country will not help achieve the existing gap. We need to think outside the box to perform the second action, and here we have to play some masterstrokes. Remember, without masterstrokes, no new volumes. The strategy needs to be flexible, and for that, the EDB structure too needs to be flexible.

"In this exercise we will not be limited to EDB only, it will involve a wider section of stakeholders including exporters themselves, various business chambers, government and non-government institutions, and foreign trade missions."

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