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Agri SMEs looking to gain from Europe’s appetite for healthy food choices

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AHK Sri Lanka Chief Delegate Andreas Hergenröther. Pic by Jude Denzil Pathiraja

by Sanath Nanayakkare

Sri Lankan agricultural sector stakeholders and export- oriented SMEs are enthusiastic to showcase their export quality fresh fruits, vegetables and spices at the Fruit Logistica international trade show to be held from February 3-5, 2021 in Berlin.

The German Industry and Commerce Delegation Office in Colombo (AHK Sri Lanka) recently organized a press conference and virtual session to increase awareness in this regard.

The treasurer of the Spice Council of Sri Lanka speaking at the event said that fresh fruits, vegetables and spices are more popular in Europe than ever before which means Sri Lankan agri entrepreneurs should be able to gain from this export trade platform.

“There is a flourishing demand for these items as more and more Europeans are cooking lavish dishes at home in the Covid situation. In this background, Sri Lankan exporters of these commodities have a good opportunity to enhance their visibility in the EU market. The timing is just right. We have our exotic products of high quality which we can display at the Berlin Trade Show, and get the most out of having our presence there. However, we can’t afford to do it on our own because of the cost factor. We are not asking things for free, but if the Agriculture Ministry could chip in with co- funding, our participation at the trade show could become a reality. Anyway, I don’t know if there’s enough time to approve funding for this purpose as the national budget is coming up next month,” he said.

A government agriculture officer who was also part of the webinar said that she would refer the matter to the relevant authorities.

When The Island Financial Review asked how Sri Lanka’s fresh fruits and vegetable exporters can increase their visibility in the European market, Linda Mense (Berlin) Sourcing + Markets Fresh Fruit and Vegetables (Egypt, Ethiopia, Peru, Ukraine) cited Peru as the best example Sri Lanka could take inspiration from. “Peru managed to become prominent in terms of export of fresh fruit to Europe as they had a clear strategy to do so. Peru has come a long way from where it was some 15 years ago. They had a very clear strategy to showcase their fresh produce to the world. They put a lot of effort and also funding into promoting their country pavilion at the Berlin Trade Show, as a result of which Peru has today become one of the most credible and valuable exporting countries for fresh fruits and vegetables in Europe. There’s a lot to learn from Peru’s successful journey in this sphere” she said.

“Moroccan fruits and vegetables are in high demand in Germany. They are certified and fulfill the European standards. They offer different assortment of fruits and vegetables: watermelon, oranges, cantaloupe melon, bell pepper, tomatoes, plum tomatoes, cherry tomatoes, citron, potatoes, onions etc’, AHK Sri Lanka Chief Delegate Andreas Hergenröther told The Island Financial Review.

Europe’s consumers and importers want quality and transparent proof of origin. For this reason Global G.A.P. certification is one of the most important European standards for sustainable production and high food safety which is a must for exporters of fresh fruit and vegetables.

‘Fruit Logistica’ is the world’s leading trade fair for fruits, vegetable and spices attracting more than 3,300 exhibitors from over 90 countries, and more than 72,000 trade visitors from over 135 countries.The trade show offers exhibitors an international platform with total visibility for fresh produce and other agricultural products, while providing opportunity for face-to-face meetings with potential business partners and strengthening existing business relations with suppliers and customers. The trade show in Berlin will also showcase innovative machinery, digitalisation, automation and network technology with special focus on greenhouse technology. During the press conference, AHK Sri Lanka Chief Delegate Andreas Hergenröther highlighted the importance of raising awareness for ‘made in Sri Lanka’ products in international markets, and increasing business opportunities for Sri Lankan fresh fruits and vegetable exporters.

Participating source markets experts pointed out that European consumers are willing to pay extra for sustainable produce and commitment to protecting the environment.

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New IPS report on ‘Elasticity Estimates for Cigarettes in Sri Lanka’

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• New study finds that increasing taxes on cigarettes will have twin advantages of reducing cigarette consumption and increasing government revenue.

• Calculated tax and price elasticities of demand for cigarettes show that smokers are price sensitive: increasing cigarette taxes by 10 per cent will reduce consumption by 8 per cent.

• A simulation exercise shows that when cigarette taxes are raised in line with inflation and streamlined between 2020-2023, government excise tax revenue will increase by LKR 37 billion by 2023 and 140,000 premature deaths from cigarette consumption can be prevented in the future.

The Institute of Policy Studies of Sri Lanka (IPS) has released a report which provides a comprehensive assessment of Sri Lanka’s historical and current tobacco tax policies to assess whether they are in line with the World Health Organization’s (WHO) recommended best practices. The new report ‘Elasticity Estimates for Cigarettes in Sri Lanka’ is authored by Dr. Nisha Arunathilake, Harini Weerasekera and Chamini Thilanka, and is part of a series of IPS research focusing on health and education.

According to the WHO, significant increases in tobacco taxes are the best means of controlling tobacco consumption. High taxes are an incentive for quitting tobacco, reducing consumption, and for not initiating smoking. The report finds that although cigarette prices have gone up over time, cigarettes are still affordable for smokers as tax increases have not kept up with inflation and income increases. Further, the tax structure is not streamlined, and tax policy changes have been implemented in an ad-hoc manner.

The report provides an estimate of price and income elasticities of cigarettes, and uses these to assess the effectiveness of tax increases on smoking prevalence in the country by conducting a simulation analysis. The results show that increasing cigarette taxes by 10 per cent will reduce consumption by 8 per cent. Finally, the study used the estimated tax elasticities to model the health and fiscal benefits of moving to inflation-adjusted and uniform excise tax system over 4 years.

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DFCC Bank and AIA virtually recognise CEO Club award winners

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Launched in 2018, the ‘CEO’s Club’ Awards organized annually by AIA Insurance for DFCC Bank staff, has since been held in grand style each quarter. The event is intended at recognizing and celebrating DFCC’s staff on their exceptional achievements in providing protection to the bank’s customers by introducing AIA’s insurance solutions.

Despite the limitations posed by the Covid-19 pandemic, the management of both DFCC and AIA were determined to continue the tradition of much deserved recognition for the DFCC staff who have excelled in providing insurance solutions to customers. As the first ever virtual AIA-DFCC CEO’s Club Awards Night, the event was held on Microsoft Teams. This pioneering event connected fifteen locations simultaneously, taking digital adoption to a new level, to celebrate award winners.

AIA CEO Nikhil Advani congratulated the winners, while commenting on the long-standing partnership between AIA and DFCC; “AIA are pioneers in Bancassurance in Sri Lanka and DFCC is one of our most valuable partners. Together over the years we have created a strong bond, driven by the common goal of providing protection and financial security to our customers. We are constantly defying odds and challenging the status quo and that is why we were able to take digital to the next level and ensure that these merited recognitions and celebrations took place, uninterrupted.”

DFCC CEO Lakshman Silva also applauded the winners and commented; “DFCC Bank, one of the oldest development banks in the country and now a full-service commercial bank, has had many trail-blazing initiatives. We entered into a partnership with AIA with the objective of enhancing our customer value proposition- and over the years have complemented each other, bringing exceptional value to customers. It was great, that together we were able to overcome the challenges posed by the Covid-19 pandemic and create an opportunity out of it, in creating a first of its kind digital event. This is what great partnerships do.”

Fifty-four CEO’s Club winners from across the island were recognized at the virtual Awards Night, for their achievements in 2019, with six others getting special recognition for their contribution as well. The top ten performers were Samitha Jayathilake ( Kottawa Branch) , Chamindu Anjana (Hikkaduwa Branch) , Dilini De Silva (Moratuwa Branch), Dinusha Jayathilaka (Anuradhapura Branch), Nuwan Abeywickrama (Kiribathgoda Branch), Anjalina Kumarihamy (Piliyandala Branch), Dilanka Jayawardena(Kaduwela Branch) , Lahiru Madushan(Central Sales Unit ) , Paskaranathan Ghengatharan (Kotahena Branch) and Lakshman Thambiraja (Batticaloa Branch ).

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Tokyo Cement and Chevron Lubricants quarterly results boost market

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By Hiran H.Senewiratne 

The CSE turned positive  yesterday with the releasing  of impressive second and third quarter results by two investor favourite counters, Tokyo Cement and Chevron Lubricants, stock market analysts said.

It is said that Tokyo Cement’s second quarter results recorded  Rs. 2.1 billion profit, which was a 183 percent increase compared to the corresponding quarter for year 2019, while Chevron Lubricants recorded Rs. 803 million in profits, which was a 29 percent increase compared to the corresponding quarter the previous year. Therefore, Chevron Lubricants announced a dividend of Rs. 3.50 per share for its shareholders yesterday.

Tokyo Cement’s impressive growth plus Chevron Lubricant’s dividend announcement removed the negative sentiment from the share market, which witnessed negative sentiments as a result of the government’s announcement of the three day Covid 19 curfew from today, market analysts said.  

Amid those developments, the market experienced a day full of fluctuations and both indices moved upwards, i.e., the All Share Price Index was up by 126. 39 points and S and P SL20 went up by 51.82 points    Turnover stood at Rs. 1.64 billion with a single crossing reported in JKH.  The latter’s 1.26 million shares crossed for Rs. 157 million and its share was traded at Rs. 130.50.

In the retail market top five contributors to the turnover were,  Tokyo Cement (Non Voting) Rs. 234.7 million (4.4 million shares traded), Tokyo Cement (Voting) Rs. 176.6 million (2.8 million shares traded), Expolanka Rs. 162.6 million (9.1 million shares traded), Dip Products Rs. 117.9 million (382,000 shares traded) and Chevron Lubricants Rs. 78.2 million (900,000 shares traded). During the day 55.1 million share volumes changed hands in 16138 transactions.    

 Further, two finance companies are going to merge to meet the co-capital requirement of the   Central Bank, which is, Rs. 2 billion; they are Nation Lanka Finance and Sinhaputhra Finance. With the merger the surviving entity would be Sinhaputhra Finance. At present both companies are struggling to meet co-capital requirements of the Central Bank. Once the merger happens they will be able to meet the requirement, stock market analysts said.

Sri Lanka rupee was quoted at 184.25/40 to the US dollar on Thursday while bond yields were largely unchanged, dealers said. The rupee closed at 184.25/35 against the greenback on Wednesday. Bond markets were dull with little activity, dealers said.

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