26 September 2020 12:00 am
The commendable performance of Sri Lankan exporters and the resilience shown during an unprecedented COVID-19 pandemic are to be rewarded by the Sri Lanka Export Development Board (EDB) of the Ministry of Trade, through a proposed export stimulus reward scheme.
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EDB Chairman Prabhash Subasinghe |
EDB’s proposal of an Export Development Reward Scheme (EDRS) presented by the Trade Minister to the Export Development Council of Ministers (EDCM) led by President Gotabaya Rajapaksa at the meeting held on September 23, had been discussed in length.
The proposed scheme will be operative under two categories; covering SMEs and large exporters for two consecutive quarters starting from 01st October 2020 based on the export performance of the exporters. The main objective of the scheme is to encourage exporters increase their export volumes in the future and be eligible to apply for the rewards.
The quantum of reward will be calculated based on the incremental export turnover of the particular quarter compared to the value earned a year ago. Large scale exporters with an annual export turnover of over Rs. 750 million will be paid 2 percent on the additional export earnings earned during the relevant period compared to the corresponding period of the previous year, while SME exporters will receive 3.5 percent of the additional export earnings.
The implementation of this scheme is expected to generate an additional export income of US$ 600 million during the period of 1st October 2020 and 31st March 2021.
Exporters were adversely hit by the cancellation of orders and declining product demands. However, they (exporters) have been diversifying their production lines as well as markets to avoid the uncertainties caused by the pandemic.
EDB is of the view that the positive contribution made by exporters to the Sri Lankan economy in spite of the difficulties should be appreciated. This proposed rewards scheme will encourage export industries to secure existing markets, penetrate into new markets, establish and promote backward linkages, and diversify into new products in line with the existing demand created by the- COVID 19 pandemic.
It is expected that EDRS will help the export sector to improve its competitiveness providing timely incentive for companies that have demonstrated their commitment and competence bringing in large volumes of foreign exchange, increasing value addition and diversifying products and markets.
EDB Chairman Prabhash Subasinghe said, “This is a game-changer for our exporters as the rewards will help exporters immensely and help Sri Lanka by increasing our foreign income.”
The EDRS will be in operation soon and a formal announcement is to be made by the EDB shortly.