The government has to adopt sustainable measures to protect local manufacturers, a top industry official said.
Chairman of Singer (Sri Lanka) PLC Mohan Pandithage told shareholders in the annual report 2019/20 that they welcome the Government’s policy impetus towards strengthening local industries.
The company is keen to widen local manufacturing footprint through diversifying into related products. We urge the government to adopt sustainable measures to protect local manufacturers such as Singer who create substantial socio-economic benefits through job generation and value addition.
“Sweeping tax concessions announced by the new government towards the latter part of 2019 led to a temporary recovery in consumer demand, which gained momentum in the early months of 2020.
However, he said following the outbreak of COVID-19 from mid-March 2020 consumer spending declined dramatically with disastrous impact over the ensuing months."
He added that the broader economic impacts of the pandemic on countries such as Sri Lanka have been pronounced, given already weak fiscal positions and reliance on tourism and remittances for foreign exchange generation.
These conditions inserted significant pressure on the Rupee, which depreciated by 7.1% Y-o-Y to close the year at Rs. 188.62/USD by end-March 2020, compelling the Government to restrict non-essential imports to the country in a bid to preserve foreign exchange reserves, he said.
“Moreover, Restrictions in the import of white goods is expected to have a considerable impact on the consumer durables industry; for organisations such as Singer, however, which have a strong local manufacturing footprint the impacts will be less severe, even affording an opportunity to capture market share from competitors who are reliant purely on imports,” he said.