“Sri Lankan exporters are confident in their outlook for export growth, despite challenges faced in the first half of 2021,” according to the results of the bi-annual Export Barometer Survey.
This survey was designed and conducted by the Ceylon Chamber of Commerce (CCC) and the United States Agency for International Development (USAID)’s Partnership for Accelerating Results in Trade, National Expenditure and Revenue (PARTNER) project.
The results were released on November 23, 2021 in a virtual roundtable discussion with key private and public sector stakeholders. The Export Barometer Survey is a bi-annual survey conducted to provide exporter insights over time.
The most recent iteration provides key insights into the impact of COVID-19 on exports and the economy’s transition to the ‘new normal’ as well as longer term competitiveness.
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Small and medium enterprises (SMEs) comprised the majority of the 120 respondents, and many hailed from the Western Province.
One quarter of the responding firms were womenowned and/or led. More than three-fourths of the respondents were engaged in goods exports, with the remaining quarter focused on services. The Ceylon Chamber of Commerce noted seven key insights from the survey, including:
1. Strong performance despite sub-optimal capacity Most exporters claim that they performed well in the first half of 2021; however, it was noted that most firms were not operating at their optimal capacity. Firms expect to increase their capacity utilization in the next six months.
2. Exporters face challenges in sourcing input and cost escalations in transport and logistics Exporters of all sizes experienced similar challenges in obtaining intermediate goods and the rising cost of transport and logistics. Partnership for Accelerating Results in Trade, National Expenditure and Revenue (PARTNER) Activity 2
3. Confidence in workforce retention, hiring, and training The majority of exporters were more confident in managing their existing workforce than they were in June and September 2020, while 29% hope to recruit for new positions in the next six months.
4. High use of digital channels to generate revenue Most exporters (67%) were leveraging online channels to generate revenue. However, these online channels contributed less than 25% of their overall revenue. Compared to large firms, both SMEs and women-owned and/or led firms relied more on digital channels (such as social media, online advertising, online marketplace) in generating sales/revenue.
5. Majority of exporters are finding new opportunities Despite the challenges faced by exporters, 75% of the firms found new export opportunities, with more opportunities prevalent among SME exporters. Exporters are exploring new markets with their current and new products/services while also promoting their new products/services to the same markets they are in. Firms are also generating new business opportunities, mainly by utilizing their existing buyers based in their current markets.
6. Facilitation needed to drive competitiveness Almost all exporters stated that they need support from policymakers, trade chambers, and donor agencies to be more export-competitive, such as improving market access and establishing links with new customers. Exporters also had specific requests for the Government regarding improving efficiency in the regulatory process, tax relief/rebate/exemption, assistance in supply chain and export finance, and deploying a financial assistance package.
7. Exporters are more confident in their outlook for their own near-term growth, versus growth of the overall economy or of non-traditional markets Exporters were more confident about their export growth in the next six months compared to their growth outlook on the economy. Most firms are looking to expand their market reach by Partnership for Accelerating Results in Trade, National Expenditure and Revenue (PARTNER) Activity 3 increasing their presence/interest in at least 1-2 markets, with some looking to diversify away from traditional markets.
The full report is available on the CCC ‘Trade Watch’ website: http://www.chamber.lk/tradewatch/backend/public/uploads/attachments/article/ExportBarometerSurveyFinal_2021_1637 571211.pdf