- Alleges PUCSL had allowed a higher hike than what CEB had requested
- Warns of closure and loss of competitiveness in export markets
- Claims hike is deterrent to draw much-needed FDI to Sri Lanka
- Says SMEs hardest hit; seeks meeting with Power and Energy Minister for win-win deal
The Free Trade Zone Manufacturers Association (FTZMA) has expressed serious concern over the recent hike in power tariff as “unreasonable” and warned of severe repercussions to exports and the economy if the anomaly is not rectified.
The FTZMA is the sole trade chamber representing BOI investor companies in the zones and has expressed its objection to the tariff in writing to Power and Energy Minister Kanchana Wijesekera.
It said that the published electricity hike by the Public Utilities Commission of Sri Lanka (PUCSL) is “unreasonably beyond the requested raise” by the CEB and is a rising concern of the export manufacturing sector which uses more electricity.
“This is quite alarming, and we are dumbfounded by this unprecedented move by the PUCSL as some of the enterprises might be facing the danger of closure,” FTZMA Chairman Jatinder Biala and Secretary Dhammika Fernando informed Minister Wijesekera.
FTZMA has analysed the proposed price hike by CEB versus what has been published and that industry sectors in all categories are currently experiencing the largest hikes. “This incremental cost is going to add to their manufacturing cost which would result in making ‘Made in Sri Lanka’ products in export markets highly uncompetitive,” FTZMA warned.
“Moreover, the Small Medium Entrepreneurs (SMEs) in the category 1-1 being hit hardest by this price hike are extremely worried about the impact on their liquidity position and business survival,” it emphasised.
Minister Wijesekera was told that the attractiveness of Sri Lanka for foreign direct investment (FDI) is evaluated by using many criteria of which the cost of operation is a significant determinant because energy cost, electricity is directly associated with the cost of production of the investors.
FTZMA has urged the Minister to revisit and analyse the price structure once again, bearing in mind that FDIs are the future lifeline and the back-bone of Sri Lanka’s economy.
It also expressed hope that the Minister would realise the overall impact on investors who are seeking a reasonable revision in the price change. A meeting with the Minister has also been sought by the FTZMA to discuss the issue further and reach a win-win agreement.