Mixed sentiments at Expo

By Cheranka Mendis

While Sri Lanka’s largest mega trade, investment and tourism promotion initiative ‘Expo 2012’ has been welcomed by stakeholders as a timely affair, stallholders shared mixed feelings on the order of the show.

Some were elated having received inquires just two days into the event, while others expressed disappointment with regard to the organising and the number of international participants.

Having started off on a sweaty note with the breakdown of air conditioning at the inauguration, which saw some 2,000 people struggling to sit through a delayed start, Daily FT yesterday walked around the exhibition premises to find out what the participants had to say.

Following are some of the views that were expressed:

Apparel

Leading apparel manufacturer MAS Holdings Chairman Mahesh Amalean told the Daily FT that the event was a timely one as the country readies itself for a takeoff. “It is an extremely timely and an important event, especially at a point of time when the economy is beginning to develop as a result of a few years of peace.”

The event is also appropriate as it poses an opportunity to showcase the competence, skills and different types of products that Sri Lanka manufactures for the international business community, he said.

Commenting on the apparel industry, Amalean stated that the industry had grown at an 8-12% rate annually and that the same rate would be continued in the future. “Although we saw a larger growth rate last year compared to the previous year, we will now grow in an organic manner,” he said.

Tea

For Basilur Tea, a total export-oriented tea company, the first time local exposure is a mix of the good and bad. While events of this calibre being held in the country is looked at in a positive manner, its organisational skills were frowned upon.

An exasperated Basilur Tea Export Director General Hemantha Perera told the Daily FT that thanks to the mismanagement and disorganisation, the company was unable to put up their name boards by the time the exhibition opened to the delegates. “While we are happy that they are trying to do something here, organising is a mess. We are really not happy about the situation.”

Adding that the Government and the EDB must take precautions and corrective measures during the next round of Expo events, Perera noted that the event was of great importance in the country’s development process. Shipping to 32 countries and having achieved 40% growth in 2011, Basilur Tea is marketed to the niche end of the market. As a result, the crisis did not affect the company in a large way. “We do value addition and hence we have survived. I urge all tea companies which say the opposite to add value, rather than exporting in bulk for better results.”

Rubber

Managing Director of Ceymac Rubber Company, a subsidiary of C. W. Mackie Daya Kulatunge happily admitted a few hours after the doors to the exhibition hall were opened, his company had received almost 10 inquiries, two of which were highly positive.

“This is a good sign,” Kulatunge said. “Most companies exhibiting here have overseas licensing. Even though the products from Sri Lanka are known in the world market as high quality products, what is lacking is the marketing for these products.”

The industry itself is looking at a “brighter future,” he said. Anticipating 25% growth in 2012 over 2011, Kulatunge expressed that the benefits of the peace dividend were now beginning to show. People are now confident to come to Sri Lanka, he said. “Even our buyers who have not visited us for some 20 to 30 years are now coming here. We have had several visits in the recent months.”

He was of the view that the event should be held on a continuous basis, once in three years.

Tiles

With the tile industry has been enjoying comfortable growth, especially within the past two years, industry stakeholders must now focus more on developing the export market, Lanka Tiles General Manager Niranjan Jayawickrema said.

Participating at Expo 2012 hoping to forge contracts with foreign buyers, particularly those from Asia such as India and the Far East, Jayawickrema commented that an event such as Expo was now a necessity for the country. “I believe that this should be held on a continuous basis, maybe once in three years or so. It is a good way to gain exposure from your home country; else we have to keep travelling to attend world fairs on a regular basis.”

Giving a quick background update, Jayawickrema said: “The tile industry per se is doing well and had two extremely good years in 2010 and 2011. Prospects in Europe and USA are looking better. Demand is also increasing on the domestic front with the reconstruction work going on.” However, on the part of the organisers, things could have been better thought-out and structured, he said. “They must give value for local investors to participate in these events.”

Services

Peercore Information Technology, which signed up with the EDB to provide visitor management solutions by registering all overseas visitors and local delegates, noted that participation in the event had been as expected.

Peercore Country Manager Mohamed Subhani Lafir told the Daily FT that almost 2,000 delegates had signed in. “The exposure we hoped to gain by participating was to mark ourselves for the IT solutions we provide. I think we have been able to do so successfully through the tags we have distributed, etc.”

He noted that the event was “decently” organised and that the company was looking at activities such as recruitments during the four-day event.

Tyre

Samson Rubber Industries Managing Director Ranatunga Rajapaksa commented that the company was already in the export business with over 60% of its products being distributed across all continents and that the purpose of partaking was to attract new buyers.

“We expect this to be a success. Holding it after a lapse of 15 years, Government intervention to host such an event is highly commended.”

He noted that the bicycle tyre industry, of which only 40% goes to the domestic market, has not been affected by the economic crisis in the Western world. In fact, for Samson, a good export figure was recorded even during the time of war.

“It really had had no major impact on the company even during the war and now during the latest world issues. With things expected to get better globally, we are confident that prospects will only be bigger and better for the country.”

Porcelain  

With much positive feedback on the low impact the recession had on local export businesses, Dankotuwa Porcelain Senior Manager International Marketing Proona V. Pemasena posed a contradictory stance.

“Our main issue started with the US recession, since 50% of our exports went in that direction. With the hit there, we moved on to Europe, which again did not seem like the best solution after the loss of the GSP+.” Now the company has decided to focus attention on the Asian continent, in particular the South Asian range. “We believe that South East Asia and the Asian range is the way forward.” The stall at Expo had managed to attract a few buyers from Europe, India and China.

The negatives are not just for the company, Premasena said. The industry too is facing troubled times, given the escalating cost of production. With labour and energy on a high level, the porcelain business in Sri Lanka is a costly business.

He also noted that there had been no direct support from the Government even after repeated requests. EDB, however, has supported the industry by providing subsidies to partake in overseas fairs and exhibitions. “This is a sector where things must be felt. Online social media does not deliver on this. Therefore, to take part in events, we must take our fragile products to them. EDB has given us various subsidies to help mitigate the costs.” The company partakes in at least six to seven fairs a year.

Gem and jewellery

Partaking in most shows in Sri Lanka, including Facets, Mushan International Director Sinan Salahudeen expressed excitement over the new exhibition. “It is a new show and is bound to be a good one in the future,” he said. Expecting better sales and the opportunity of identifying potential buyers, the company is now focusing on the Asian region. “We are well recognised in the Chinese market. We also specialise in the European and Asian market,” he said.

Due to the company’s high quality of gems and high-end clientele, it has not experienced a negative impact due to the world economic situation. “We have regular buyers who are ready to pay a high price for the products. Our expectation is to attract more such buyers with the hope of expanding our business further during the four-day event.”

Herbal products

Identifying Expo 2012 as a ‘one-stop-shop’ for buyers and investors interested in local products, Link Natural Products had several objectives in being part of the event. Sharing his views, Export and Business Development Division Director Fazal Mushin stated that while the primary aim was to showcase the range of products offered at both domestic and export levels, the company also wanted to participate to support this national cause.

“This is also a learning curve for our staff as we cannot afford to take them all abroad for such events. It is also a new experience for us to deliver on such a set-up in the local market.” Link’s target is to attract 10 buyers by the end of the four-day period.

On the event front, he stated that more in-depth information on who would be attending rather than releasing the numbers only would have helped local exporters have clearer targets and achieve better results. On the sectoral side, he maintained that the Government should have more dialogue with sector. “Since we are the end players, we have a better idea on what is happening in the market. Consultative dialogue is appreciated.”

Tourism

On to the left of the main meeting area stands a colourful and attractive stall, hosting tourism-related businesses. Passing the BOI stall, Sri Lanka Tourism has a separate stall featuring local handicrafts as well as exhibition stands and visual merchandising by the Academy of Design. M.S. Kanthi-Latha from Galle sits with a ‘beeralu’ pillow weaving lace onto a long white ribbon. Having learnt the craft when she was just eight years old, Kanthi-Latha has been exporting on a small scale for the past 15 years. Her exposure to the export industry came when she won the National Crafts Council President’s Award for six years in a row. “Thanks to that I managed to visit seven countries and that is how I built contact to start exporting.” Even though the demand for ‘beeralu’ lace is slowly growing, costs are also rising since raw materials like the thread they have to use is imported since it is no longer made here and they also find themselves unable to convert value of time and effort into cash.

Furthermore, the products made from ‘beeralu’ remain at the high end and are mostly bought by affluent customers. Kanthi-Latha said: “I hope to get a few more customers/buyers from here. It would help me immensely to support myself and family.” Karunandasa Olabodauwa, who was seated carving a mask in the middle of a lot of brightly coloured and varnished new ones, had sold eight of his masks on day one. “I am happy things turned out this way. Sri Lanka Tourism invited us to come and display our work here. Prior to this, we did not engage in exports. It was only for the domestic market. However, this made me realise that my work is good enough to be sold abroad.” Several inquiries had been made by those who had bought masks, he said. “We hope we get enough orders to go home happier than we came here.”

SMEs

Started as an export project by the EDB in 1996 to empower rural villages, the Tissamaharamaya Export Product Village People’s Company produces tea packaging boxes for the export market while engaging in agri and handloom products on a smaller scale. Manager Priyanthi Kasthuriarachchi stated that even though they currently export through a company, the aim was to find direct buyers at the Expo. The Company has a membership of 50 villages and 500 families and is confident that the products are good enough to compete in the world market, obtain a good price and find direct buyers.

Vitra Organic, which exports high quality plantains to the Middle East and other countries, finds the Expo a good event to find new markets. Company Managing Director Jayantha Perera said: “It is very hard for us to find markets. Events like this give us an opportunity to do so and showcase our abilities, such as the model farm we have in Ambepussa.”

He added that the demand had been good and expansion was on the cards. Within six months, two more model farms will be in operation in Hambantota and Anuradhapura. “It would support the business more if we are able to secure some contracts here,” he added.

Fisheries

Dissatisfied over the number of participants, Tropic Frozen Foods Quality Assurance Manager Ruwan Indika stated that most people were surprised to find that Sri Lanka exports fish and that too of high quality. “They just kept asking us if we actually do export it and the point is that we were the first company to start this business in 1983,” he laughed.

“There is a good demand for our exports of fish; the issue we are faced is the lack of good raw material, i.e. fishing quantities to support the demand. Exporting 400 tons per month with 90% going to Europe and the other 10% being split between USA and Japan, the market prospects seem better than ever,” he said.

The loss of GSP+ did have effects on the company as well as the industry, but given its high standard goods, the company has progressed, Indika said.

Spices

G.P. De Silva & Sons International Director Nihal De Silva also added that the event was a good opportunity to further expand the business. “Seeing that the industry is doing well despite the short supply of cloves this year due to weather issues and the general high demand which we often cannot match, the future looks good,” De Silva said. “There has been a good response so far; we have received several inquires and are confident that we will manage to set up ties with new buyers during the event.”

Confectioneries

Despite its stall featuring shelves filled with chocolates and other sweetmeats, Edna was not impressed with the turn of events. “We have not seen as many buyers as we expected,” Edna Group General Manager International Operations Waruna Buwaneka said. “We hoped to meet and talk shop with businessmen from US, India and China especially, but the turnout has not met our expectations.”

Disappointed with the organising, Buwaneka noted that the stall, placed in Hall C, away from the main hall, was hardly promoted by the organisers. “We are almost forgotten. International buyers are not encouraged to come this way. While groups are taken all over, our side of the event premises went unnoticed and ignored in most instances.”

He also noted that the EDB was strongly promoting a cultural show on day one of the event, etc., and had started a shuttle service from fairly early in the evening. “They are getting tourism and exports mixed up in a big way. As a result, exporters like us do not get the full value for our money.”

Pix by Daminda Harsha Perera