Ceylon Tea enters Iraq after Rishad’s Baghdad visit

Thanks to a prompt and joint bilateral trade action by both the governments of Iraq and Sri Lanka, the detained consignment of more than 100 Pure Ceylon Tea containers valued around $ 13 million have started arriving from 4 March inside the Iraqi market which has now acquired an unquenchable thirst for Ceylon Tea during the last few decades.

Since 19 February, more than 100 Ceylon Tea containers consigned to Iraq from Sri Lanka were detained in the locations of Iraq-Kuwaiti border, Aqaba Free Trade Zone of Jordan and Umm Qasr port of Iraq. At least another 50 Ceylon Tea containers were in mid-sea on its way to Iraq while another 50 containers, packed and ready for shipment, awaited in Colombo destined for Iraq. The estimated average value of the total consignment is more than $ 13 million.

Upon hearing the latest developments, Minister of Industry and Commerce of Sri Lanka Rishad Bathiudeen promptly summoned an urgent stakeholder session on 20 February at the EDB premises, where leading representatives from the tea exporter community, Minister’s top officials from the Ministry offices, the EDB, and the Department of Commerce, among others were in attendance.

Thereafter, working round-the-clock, the Minister’s liaison team headed led by Ashoka Godawita (Deputy Director of Commerce), succeeded in clinching an urgent, one-to-one Ministerial level meeting in the next 48 hours to be held in Baghdad with Minister Bathiudeen’s counterpart, the Iraqi Minister of Trade Kheer-allah Hassan babaker Muhammad.

Both Minister Bathiudeen and Minister babaker Muhammad, having successfully completed bilateral trade talks, then proceeded to focus on the release of the Ceylon Tea consignments unexpectedly held as a result of change of tea-testing parameters by the testing agency.

Bathiudeen was assisted in Baghdad by P.D. Fernando, Director General of Commerce of Sri Lanka, the committed three-man team from the Sri Lanka mission in Baghdad led by Sumith Nakandala, Sri Lanka’s Ambassador to Iraq, and officials from Tea Research Institute and the Sri Lanka Tea Board. Also present during the session was Hashim M. Hatem Al-Sudani, the Director General of Iraqi Foreign Economic Relations Department under the Iraqi Trade Ministry.

Iraq became the fifth largest buyer of Sri Lankan tea after Russia, Iran, Syria and Turkey, absorbing $ 83 million worth of tea from Sri Lanka. Sri Lanka is the single largest tea supplying country to Iraq, claiming 60% of Iraqi tea imports in 2012 and almost 91% in 2011.

However, during the 21 February meeting with Minister Bathiudeen, Iraqi Minister of Trade babaker Muhammad revealed: “When considering Ceylon Tea purchases by Iraq, not only direct purchases but even Ceylon Tea coming to Iraq via Afghanisthan, Jordan, Turkey, Iran and other Middle East destinations, we believe that our country (Iraq) is the leading buyer and user of pure Ceylon Tea with an estimated annual purchase exceeding $ 70 million to $ 80 milliom.”

Among the leading Ceylon Tea exporters in Colombo delivering to Iraq are Anverally & Sons, George Stuart Teas, Shan Teas, Setmil Teas, Finlays Colombo, Uniworld Teas, Union Commodities Exports and Setmil Teas.

As a result of Bathiudeen’s representations in situ, the Ministry of Industry and Commerce is now pleased to announce that the first set of detained tea containers were released and started arriving in Baghdad warehouses from 4 March – a development that will have trade benefits in the medium to long term for both countries since the long-felt need for direct exports and imports from/to Baghdad-Colombo (rather than routing products through third party ports) has clearly emerged as a crucial necessity in taking bilateral trade to the next level. More consignments are expected to be released in the coming days.

Many Lankan Tea exporters praised Bathiudeen and the Ministry for the action taken on behalf of them. “We are very happy about the level of response by the Government and especially Minister Bathiudeen,” said Upul Dissanayake, Export Manager of Anverally Tea, the biggest Pure Ceylon Tea exporter to Iraq. “The prompt follow up by Industry and Commerce Ministry was also important for the release of them.” he added. About 100 containers of Anverally Tea were also held due to the testing issue.