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Northern fishermen switch to China-backed sea cucumber boom

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ECONOMYNEXT – Over 600 fishermen in Sri Lanka’s former northern war zone have switched to sea cucumber farming, a booming trade, in the coastal belt of Jaffna and Kilinochchi where a Chinese firm started a hatchery five years ago.

China’s joint venture Gui Lan hatchery in Jaffna’s coastal village of Ariyalai was started when many northern fishermen were finding it harder to catch large fish which is blamed on outlawed bottom trawling employed by Indian vessels.

The fishermen were given one-month-old small sea cucumbers from the hatchery, which were grown in their usual fishing spots in the sea.

N Dhivakaran, president of Jaffna District Sea Cucumber Association, told EconomyNext that over 600 fishermen have now started sea cucumber farming after they saw the potential for a steady income in the new venture.

“There are investors for sea cucumber farming. Now the fisheries ministry also promotes sea cucumber farming through incentives,” said Dhivakaran.

Dhivakaran maintains a 10-acre farm near the Gui Lan hatchery in Ariyalai. He now sells between 2,000 and 3,000 sea cucumbers a month, earning between 60,000 and 90,000 rupees in revenue.

“We sell a sea cucumber once it reaches 300 grams in weight,” he said. “I started the farm with 40,000 small sea cucumbers and now the hatchery’s production is not enough. So I try to get additional sea cucumbers from other sea areas.”

A 300 gram sea cucumber is sold for around 400 rupees to local agents who export them to countries like Singapore and Hong Kong.

“We do not have the proper certification process to export them directly to China. Our sea cucumbers go through that certification process in Singapore and Hong Kong before they are exported to China. So we are losing some foreign exchange because we do not have the certification process.”

China had been long awaiting an entry into Sri Lanka’s former northern war zone to strengthen its foothold in Sri Lanka, analysts and government officials have said.

Gui Lan Hatchery was its first project in the North, a project that’s being touted as assistance to revive the livelihoods of northern fishermen. Some legislators in the North, however, have raised concern over growing Chinese presence in the former war zones where India has historically had held more sway given in strong cultural and religious ties.

But fishermen now appreciate the Chinese move mainly because of a lingering Indian bottom trawling issue that has hit their livelihoods hard.

“We have provided over 170,000 small sea cucumbers to fishermen in both Jaffna and Kilinochchi district,” Sri Ganeshan, the officer in charge at the Gui Lan hatchery told EconomyNext.

“There is a huge demand now and many people are waiting to register companies and start sea cucumber farming. The Chinese have been educating us on the technology to produce sea cucumbers and it has been helping a lot of people now.”

Sea cucumbers are considered a delicacy in the Far East, with a majority of consumers in markets like China, Hong Kong, Taiwan, Singapore, Korea, Japan and Malaysia. In China, high quality specimens can occasionally fetch over 3,000 US dollars per kilogram after being cooked.

Demand for sea cucumber in the international market is growing even though it is only now being popularized among the Sri Lankan community. The price of one kilogram of sea cucumber in the international market garners a value of Rs 20,000 to 30,000.

Gui Lan is the first hatchery in Sri Lanka to mass-produce high value sandfish sea cucumber for commercial farming. Most sandfish sea cucumbers are depleting due to overexploitation, and hatchery bred juveniles are given to farmers to grow in their respective farms.

These factors have boosted the drive to grow more sea cucumbers and people like Dhivakaran want to expand their farming because of the return.

“I am going to start breeding sea cucumbers separately from next month,” he said.



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Business

Seven factors of concern at upcoming Monetary Policy Review

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by Sanath Nanayakkare

The Central Bank of Sri Lanka (CBSL) is scheduled to announce its latest monetary policy review on 20th January 2022, with all eyes on dwindling foreign reserves and foreign currency exchange in the country.

In this context, First Capital Research has named 7 factors of concern that could be taken into account at the upcoming monetary policy review. They are as follows.

* Foreign Reserves USD 3.1 billion – Dec 2021

* Inflation CCPI 12.1% – Dec 2021

* GDP Growth -1.5% – 3Q2021

* Private Credit LKR 60.5 billion – Nov 2021

* 03M T-Bill rate 8.38% as at 12.01.22

Liquidity and CBSL Holdings LKR -364.0 billion and LKR 1.42 trillion

Balance of Trade (BOT) and Balance of Payment (BOP) USD -6.5 billion and USD -3.3 billion for Jan-Oct 21

First Capital Research’s Policy Rate Forecast – Jan 2022-Apr 2022 notes that they believe the CBSL may highly consider tightening the monetary policy rates in this policy review but given the concerns over economic growth, there is a probability of 40% for CBSL to maintain its policy stance at current levels.

“With high frequent indicators improving in line with expectations, we have eliminated any probability of a rate cut. We expect a continued increase in probability for a rate hike in order to prevent overheating of the economy amidst the given fiscal and monetary stimulus,” they said.

As per First Capital’s view, CBSL either can choose to hike policy rates by 50bps or 100bps or hold policy rates steady, while a rate cut is off the table due to the high debt repayment and the high domestic borrowing requirement.

First Capital believes that there is a 60% probability for a rate hike due to the remedial actions required in achieving external stability.

However, there is also a 40% probability to maintain the policy rates at its current level in order to further improve the high frequency indicators.30%, they noted.

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Sri Lanka’s dash brand enters international markets

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Multichemi International Ltd, which manufactures and distributes a wide range of products under dash, one of Sri Lanka’s leading detergent and household care brands, has begun exporting its products to several international markets in Asia and Oceania, with plans also to enter Africa. The dash brand includes a wide range of products in car care, household care, home fragrances and laundry care sectors. Multichemi International Ltd, which has been awarded ISO 9001:2015 certification, is a Sri Lankan pioneer in environment-friendly cleaning products, having launched the country’s first biodegradable, safe cleaning products over 28 years ago.

Amila Wijesinghe, General Manager of the Company said,”Having conquered the domestic market, we are now ready to capture the international market. We are confident that our products which are of high quality will receive a good demand overseas as well. The feedback we have received so far from our overseas customers is extremely encouraging. We are dedicated to taking our products to the international market, to bring in foreign currency to the country and help uplift the economy”,

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Janaka Abeysinghe appointed SLT CEO

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Sri Lanka Telecom PLC has announced the appointment of Janaka Abeysinghe as its Chief Executive Officer (CEO) with effect from February 1, 2022.

The incumbent CEO Kiththi Perera will be overseas on leave for a period of two years to pursue higher studies, according to a stock market filing by the company.

Abeysinghe joined SLT in 1991. In his present role, he leads the enterprise and wholesale business of SLT that provides integrated voice and data solutions to enterprises, government institutions, domestic telco operators and global wholesale carriers.

In his career at SLT spanning 29 years, he has held a number of senior positions, including general manager Enterprise and International Sales and has extensive experience in the areas of Enterprise Digital Services, Enterprise Communications Solutions, Data Communications, Business Development, Domestic and International Switching Operations and Global Wholesale Voice & Data Business.

He holds a Master’s Degree in Electrical and Computer Engineering from the University of Kansas, USA and a BSc degree in Electronics and Telecommunications Engineering with a First Class Honours from the University of Moratuwa.

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