Since the first announcement in June 2020, expectations have been high on the potential of the Eravur Fabric Processing Park to catalyze a new era for Sri Lankan textile and apparel manufacture.
Supported through the Ministry of Industry and Commerce and the Board of Investment (BOI) of Sri Lanka, working in close collaboration with the Joint Apparel Association Forum (JAAF), the apex body of the apparel industry in Sri Lanka, the vision for Eravur is beginning to take shape.
Of the allocated approx 300 acres of land, fifty have been allocated for the Park’s maiden investment of US$ 35 million to establish a state-of-the-art fabric mill. Negotiations are also underway with two international companies to infuse mega investments for the remainder. The Park is estimated to attract a cumulative investment of US$ 300 million. The zone is also seeking further investments towards Dyeing, Washing, Knitting, Weaving, and other associated and ancillary activities.
Cabinet approval for the Zone’s classification under the Strategic Development Projects Act was also secured, enabling the extension of tax and other relief and incentives to investors.
Rapid progress towards vertical integration
“We would like to see the first company commence commercial operations in the next 6 months to 1 year,” stated BOI Chairman Sanjaya Mohottala. “We have been very aggressive on timelines because of the clear consensus on the nationally significant value that the Park can generate. At present, all land has been demarcated, and water and electricity supply are being finalized. In excess of half the commercial land has been allocated or reserved, and we are seeing great demand. There is clear recognition locally and internationally as to the immediate potential. If necessary, we are able to expand the zone even further.”
Leveraged in support of Sri Lanka’s highly developed apparel manufacturing sector, which has steadily benchmarked itself on global standards for ethical, sustainable production and high levels of technical and technological expertise, Eravur’s promoters also see the project as an opportunity for Sri Lankan-made apparel to take global leadership on sustainability in its most holistic sense.
Mohottala explained further that the most immediate benefit from the Park’s establishment will be in the cost advantages and enhanced economies of scale gained through capacity expansion and vertical integration of domestic supply chains.
Currently, Sri Lanka has approximately 300 apparel manufacturing facilities across the country. By contrast, it has only 7 textile and raw material factories capable of producing fabric for export, and for conversion into garments for export. At its peak, Sri Lanka imported over 250,000 MT of fabric both for export-oriented apparel manufacturing and for local consumption in 2019, at a cost of US $ 2.2 billion.
In the context of unprecedented disruptions across global supply chains in particular and persistent commodity and currency volatility, increased availability of high quality raw materials will enable an immediate and drastic reduction in raw material costs, while also conserving foreign currency.
Increased domestic production of textiles also translates to a higher percentage of domestic value. If that threshold increases from its current 52% to 65%, it qualifies for a larger proportion of Sri Lankan exports for zero-duty benefits under GSP Plus1.
The culmination of a pioneering national journey in sustainability
The economic argument in favour of investing in Eravur is bolstered by its potential to also be the most sustainable venture of its kind in the entire Asian region, with local stakeholders having already committed to establishing extensive renewable energy facilities, water recycling facilities, science-based targets, and circular business models.
At a macro-level, increased local production capacity will contribute significantly to all these targets by reducing the end-to-end length of Sri Lanka’s apparel supply chains. This in turn enables tighter backward integration and lower carbon emissions.
Taking a cue from the Sri Lankan textile and apparel’s industry’s outstanding achievements on environmental sustainability to date, the Zone is being designed from the ground-up to facilitate and incentivize sustainability in every facet of its operations. In terms of fabric processing, the main focus is on wastewater treatment.
Mohottala continues: “Sri Lanka’s environmental standards for industries are quite stringent, especially compared with regional competitors. A key feature of the Zone will be its central wastewater treatment facility with a sea outfall, which will require a high standard of treatment. Fortunately, we already have strong expertise available locally, with many of Sri Lanka’s textile producers having established facilities on par with global best practices on wastewater treatment. We have used this to our advantage by calling in the local industry’s technical experts and drawing on their pioneering experiences to optimize wastewater treatment protocols at Eravur.”
Adding that this will be one of many positive attributes all stakeholders downstream of the textiles produced at the Zone can lay claim to, Mohottala says, “With the greater localization of production, we also gain improved oversight and control over environmental standards within the Zone. This also enables greater transparency, traceability, and accountability across the supply chain, which in turn will confer preferable competitive advantages to Sri Lankan apparel exporters. In addition, this will empower brands and retailers to make clear and credible claims to genuine sustainable sourcing.”
An end-to-end opportunity
Another significant advantage for Eravur is that it is purpose-built with the most advanced environmentally friendly technology available. This will also promote efficiency in energy and water consumption, as well as additional infrastructure for recycling and recovery of water used in production, for which the BOI aims to provide investors with additional incentives.
Notably, Eravur also enjoys a high level of solar irradiance and consistent high-wind conditions, making any manufacturing facility established in the area, ideally suited for solar and potentially, wind turbine power generation.
“Augmentation of the Zone’s energy requirements with plentiful renewable energy will enable cost savings on the energy-intensive aspects of wastewater recycling. Given the consistent annual reduction in the cost of solar and wind energy, the conditions at Eravur are another unique attraction for investment into the Zone, and potentially enables the entire supply chain to utilize global incentivizes around responsible and sustainable production,” Mohottala said.
In addition to the wastewater treatment protocols, the Zone will also include a sludge treatment facility, with further trials already underway for responsible disposal. These include tests using micro-algae to breakdown sludge, as well as utilizing sludge to fuel furnaces and as bricks with a bio-mat mask.
The final and potentially most vital contribution which the Eravur Fabric Processing Zone is the empowering impact it will have on the lives of Sri Lankans in Batticaloa. At present, the district has an estimated population of 621,887, of which, an estimated 60,912 individuals are below the poverty line. As at 2019 – prior to the pandemic – unemployment in the region stood at 6.4%
“With the development of the Zone, we will be able to create thousands of stable, well-paying direct and in-direct jobs. This could prove to be one of the most transformative developments to take place in the Eastern Province in recent history,” Mohottala concluded.
Sri Lanka Tourism commands attention at World Routes 2021
Sri Lanka made a huge splash at the 26th World Route Development Forum (World Routes 2021), which took place in Milan, Italy, recently. By making its presence felt at the forum, Sri Lanka pitched its destination for global airlines to consider it as one of the top holiday destinations for the upcoming winter season and beyond. Sri Lanka Tourism officials were able to directly engage with decision-makers from the global route development community, including world’s air services, while taking advantage of dedicated in-person and virtual event days combining extensive meeting opportunities, exclusive industry insight and first-class networking opportunities.
The Chairperson of Sri Lanka Tourism, Ms. Kimarli Fernando, expertly leveraged on the platform provided by World Routes 2021 to highlight Sri Lanka’s 5-year global campaign and growth potential. Her keynote presentation was followed by a panel discussion and a Q&A session with attendees in collaboration with Major General (Rtd.), G.A Chandrasiri , Chairman, Airport and Aviation Services. Through the duration of the Forum, Sri Lanka Tourism was present on all social media platforms for driving brand awareness, pushing Destination Sri Lanka to the front and centre of global travel and tourism operators present.
With the Sri Lankan Government declaring this a growth decade, Sri Lanka Tourism has been aligned to the government’s vision as enshrined in the 10 pillar strategy document. Over the last two years, Sri Lanka Tourism has advanced the industry across various factors to bring prosperity to all stakeholders and to ensure Sri Lanka tourism fulfills its potential. Concurrently, with a high vaccination rate, Sri Lanka has opened up to fully vaccinated tourists, offering them a safe and exciting stay.
One of the key pillars has been connectivity and the efforts made have been fruitful – with several European and regional airlines resuming direct flights, new routes being established and increased frequency of flights to Sri Lanka which will boost tourism for the upcoming peak season.
Apart from elaborating on the strategy, Kimarli Fernando engaged in an absorbing Q&A session with global airline industry stakeholders. During her keynote speech she elaborated on Sri Lanka’s biodiversity, UNESCO sites and other cultural and nature offerings. One of the highlights of her speech was tourist investment. Tourism has been attracting substantial investment despite the challenges emanating from the pandemic. Between March 2020 – June 2021, the Government of Sri Lanka has attracted over US$950 million in investments, received 64 project proposals and approved 38 projects to the value of $102.38 Million. These ventures will be executed under the Sri Lanka Tourism Development Authority (SLTDA). In order to attract strategic investors, the Investor Relations Unit was launched as a single point of contact for all tourism investments. In addition, the Government of Sri Lanka is extending a host of financial incentives and fast-track processes to get projects off the ground within the shortest possible time.
Given the recent tie-ups with France tourism operators and a similar push in more key western markets, the brand awareness of Sri Lanka is growing in strategic markets.
ComBank wins Daraz award for ‘Best Engaging Overall Cards Base’
The Commercial Bank of Ceylon was presented the award for ‘The Best Engaging Overall Cards Base’ at the recent ‘Payment Partner Performance Awards 2021’ of Daraz, South Asia’s premier online shopping marketplace.
The Bank was awarded this title for empowering the Daraz platform by generating the highest number of transactions by both credit and debit card bases and the highest number of unique buyers’ engagement during the financial year 2020-21. This is the second consecutive year that the Bank was honoured with this award.
The Commercial Bank of Ceylon has been an Internet Payment (IPG) service provider to Daraz from 2018, and has since partnered with the online retailer to power ‘Daraz 11.11,’ the world’s biggest online sale.
The two organisations are working together to offer diversified and unique offers to customers with a view of offering them attractive value additions, the Bank said. Commercial Bank cardholders can enjoy periodic discounts at Daraz with the offers structured by the Bank, and the convenience of Easy Payment Plans of up to 60 months.
Launched in 2012, the Daraz eCommerce site has an active presence in Pakistan, Bangladesh, Sri Lanka, Myanmar, and Nepal. The marketplace has over 2.5 million products in diverse categories such as consumer electronics, household goods, beauty, fashion, sports equipment, and groceries. It was acquired by the Alibaba Group in 2018.
Commercial Bank Credit and Debit Cards offer year-round promotions covering a wide variety of services. Commercial Bank was the first bank to offer loyalty rewards for both Credit and Debit Card holders under its Max Loyalty Rewards Points scheme. The Bank was also a pioneer in extending promotional discount offers which were traditionally only offered for Credit Cards to its Debit Cards.
Commercial Bank cards are the fastest growing cards in Sri Lanka and enjoy market leadership in Credit and Debit Card cumulative point-of-sale usage. The Bank offers a variety of Credit Cards in the Silver, Gold and Platinum tiers of Visa, Mastercard and UnionPay Cards, as well as Visa Signature, World Mastercard, Visa Infinite, UnionPay Asia Prestige Platinum and UnionPay Asia Prestige Diamond Cards in the premium segment. The cards are equipped with ‘Tap ’n Go’ NFC technology and are backed by a strong NFC Point-of-Sale (POS) network.
Sri Lanka’s first 100% carbon neutral bank, the first Sri Lankan bank to be listed among the Top 1000 Banks of the World and the only Sri Lankan bank to be so listed for 11 years consecutively, Commercial Bank operates a network of 268 branches and 931 automated machines in Sri Lanka. Commercial Bank is the largest lender to Sri Lanka’s SME sector and is a leader in digital innovation in the country’s Banking sector. The Bank’s overseas operations encompass Bangladesh, where the Bank operates 19 outlets; Myanmar, where it has a Microfinance company in Nay Pyi Taw; and the Maldives, where the Bank has a fully-fledged Tier I Bank with a majority stake.
Banks’ Chief Internal Auditors’ Forum appoints new committee for 2021/22
The Chief Internal Auditors’ Forum of Banks appointed its 5th committee recently. The inaugural committee meeting was held on 17th November 2021 subsequent to the AGM held on 3rd November 2021. Charitha Jawawickrama of Sampath Bank was appointed as the President, Numair Cassim (Amana Bank) as Vice President and Nirosha Perera (Union Bank) as Secretary. Others in the committee include Varuna Koggalage (Seylan Bank), Dulan Abeyratne (HSBC), Dhanjaya Dayananda (SDB), Jayan Fernando (DFCC), Kushlaini Allis (NTB) and Gamini Jayaweera (NSB). The outgoing committee included Maduwantha Liyanage of BOC (Immediate Past President), John Premanath (Commercial Bank) and Chandima Samarasinghe (Cargills Bank).
The Forum was established to build strong relationships amongst the Licensed Commercial Banks and Licensed Specialized Banks in dealing with new developments and challenges pertinent to the industry. It also supports Internal Audit professionals to enhance comradeship and encourages participation of Banks to share knowledge and industry best practices. Since re-establishing in 2015, the forum has become an integral body that supports and assists Banks with regard to common audit related concerns in the industry.
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