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What defines an entrepreneur? 

03 Oct 2021

  • SMEs wait till opportunities fall on their lap
  • Businesses do not work together due to ‘trust issues’
  • SL’s FTAs permit exploitation of SL
By Yakuta Dawood and Madhusha Thavapalakumar Who are entrepreneurs? What defines entrepreneurship? What qualifications should a person have to become an entrepreneur? According to Export Development Board (EDB) Chairperson Suresh de Mel, any individual or business that waits around till a lucrative deal comes and falls on their lap on its own could not become the answer for any of these questions. In a not-another-typical-export interview with The Sunday Morning Business, de Mel opened up about how many Sri Lankan businessmen could not be termed as entrepreneurs due to their hesitancy to explore the wide range of opportunities the world provides to them with ease. Reflecting on how small and medium-sized enterprises (SMEs) are operating in the industry, de Mel highlighted that rather than seeking new or seizing available opportunities in the market, they wait and complain until the opportunities fall into their laps to start something of their own. He stressed that even though there are many challenges occurring due to the Covid-19 pandemic, SMEs should create new opportunities by starting to come up with “out of the box” solutions to the difficulties they might or are facing right now. “People need to come out of their comfort zone and look for opportunities. For every challenge, there is an opportunity. This is the time for entrepreneurs to think out of the box by doing something creative. It starts with a positive mindset,” de Mel expressed. Addressing a challenge, he stated there is a major difficulty in connecting with SMEs and building strong relationships with them, as they do not prefer to divulge any of their operational information to EDB or local banking partners even when they are obtaining financial assistance. Revealing the reason, de Mel noted that it is due to “trust issues” of these companies, adding: “SMEs do not work together; they do not form partnerships with local banks because they do not trust enough to divulge information. Therefore, this is the reason why SMEs remain at the same place without expanding their operations through available opportunities such as joint venture, equity capital, etc.” However, to resolve this matter and enhance the performance of SMEs in the industry, EDB has scheduled to commence programmes with an aim of improving the SME communication model and teaching them about presentation skills, how to find an appropriate market, and how to identify problems and fundamental issues, essentially giving an overall training session to develop their export business. “The problem is, Sri Lankan entrepreneurs spend more on themselves than investing into their company; they take loans with high interest rates to protect themselves from divulging information, do not know how to market their products suitably, and do not know how to properly manage their operations. Hence, we will start teaching (these to) them and will also conduct individual meetings with export companies, so that they could address the problem to us personally rather than in front of all other businesses in that particular sector,” he added. Looking at the bright side of the pandemic, de Mel said that it is extremely vital for businesses to start embracing opportunities that are already available due to advanced technology, as it is capable of connecting everyone from one country to another without any cost or any other obstacle. He said that this is a luxury he did not have when he started his business about four decades ago. Expressing his views on his personal experience, he said that prior to the pandemic, the number of meetings he had per day was very limited, as they involved tiring arrangements, travelling from one place to another, etc. However, now, thanks to the pandemic, he could have more meetings through digital platforms than he had in his entire business life. De Mel said that it is amazing how one could connect with a potential buyer at any time with anyone with so much ease. Giving an example of a recent incident, de Mel mentioned that the latest online business-to-business (B2B) meeting held with South China attracted more than thousands of businesses, which is a great opportunity given the country’s situation. “Smart people make use of the opportunity available through the online platform and it is important that other people also take advantage. Earlier it required a minimum of Rs. 1 million to attend an international trade fair, but now it is cost-free. Personally, I have had more meetings with customers (now) than I have had in 40 years of business,” he said. Further, to address this issue and increase online participation of export businesses, EDB, along with its regional chambers, has started to conduct workshops for people who do not know how to operate Zoom and other online platforms. Commenting on this, de Mel said the problem right now is that rural people have been complaining about “not knowing how to use” the internet for online meetings, business operations, etc., even without attempting to try using these platforms at least once. “Online activities are easy and phenomenal right now. People need to learn some English and start to learn things from Google. I learn so much every day, but this culture is not there in Sri Lanka. Therefore, building this culture amongst people is really important,” de Mel highlighted. Adding further, he stated that if the barrier of using an online platform is taken down collectively, EDB would be able to successfully conduct weekly meetings with sector-wise businesses that are operating in Sri Lanka, instead of having the need to meet them all at one place. Achieving the set target Optimistically commenting on achieving the announced export target of $ 16 billion for the year 2021, de Mel stated that the target is possible to be achieved as EDB has witnessed positive enthusiasm from local exporters during the past months. “With the Covid-19 pandemic, businesses have started to see the value of exports. Two years ago, there was no celebration, push, or recognition in the export industry, but today, everyone is supportive and it has become a top priority,” de Mel expressed. When inquired whether the supply chain has been disrupted with regard to the pandemic and ongoing travel restrictions, he stated that according to the latest reports received by exporters in the industry, it is a “no”, as they have been fully booked with their upcoming orders. Elaborating further, he said that this is because people from the European Union (EU) and the US, who had stopped importing larger sums of goods from Sri Lanka due to their lockdowns, have started to gradually import from this year. Nevertheless, de Mel noted that even though there is a production drop due to pandemic restriction, “it is amazing how they are managing, and EDB is doing the best to resolve any challenges faced by exporters in the industry”. Diversifying the export basket Over the years, Sri Lanka has been able to develop the existing export industries such as tea, rubber, coconut and coconut-based products, apparel, seafood and ornamental fish, spices and concentrates, and much more to cater to international markets. Nevertheless, de Mel said that there is also a need to explore niche markets with an aim of diversifying the product basket and markets. Explaining to us, he stressed that there is an abundance of opportunity available to be looked at in the agricultural sector. “We have spoken about expanding the export basket for about 20 years. But this is the best opportunity we have ever had, since there is a huge trade shift going on. People are looking for different markets and products. Sri Lanka is in a fantastic position and our opportunities with agriculture are enormous,” he noted. Elaborating on the agricultural sector, he said that prior to Covid-19, there was a lack of management and technological infrastructure to manage fruits and vegetables, which is why he said there is a huge opportunity for the plucking, handling, storage, freezing, dehydration, packing, branding, and marketing of the products to international countries. He also emphasised that the present moment is the opportunity that should be taken by export companies, given the pandemic period where consumers globally are much more concerned and cautious about eating healthy to maintain their health conditions. “People in the world are lining up to support us. Globally, there is an increase in consuming healthy food, and fortunately, Sri Lanka has an abundance of it. Right now, EDB is helping companies to brand, market, and gain exposure in the international market,” de Mel continued. Switching the focus to the spice industry, de Mel also said the industry is performing quite excellently as the export growth has doubled this year, in comparison to previous years. According to him, this is essentially due to Sri Lanka’s unique quality and brand, health consciousness of consumers, and value of the price for quality products in the global market. “We have a lot of opportunities to grow. Currently, EDB is helping companies to brand, market, and gain exposure with international clients to expand their distribution channel,” he added. FTA with other countries When inquired if Sri Lankan exporters are taking advantage of the current free trade agreements (FTAs) with countries, de Mel stated that unfortunately, Sri Lanka is being exploited by the other parties as Sri Lankan businesses do not make proper use of the signed agreement. “Stakeholders from both sides should be committed; however, it is not the same with Sri Lankan companies. We have not yet started to use enough of the existing FTAs, and signing more agreements will result in exposing ourselves to exploitation,” de Mel stressed. He expressed that Sri Lankan businesses are in the comfort zone of exporting products and services to the US and EU markets, which as a result limits them from gaining hold of new markets such as India and China. He stated that it is critical for Sri Lankan companies to negotiate trade agreements with existing and new countries as international competitors have started to perform better than Sri Lanka in comparison to their export operations in previous years. Sri Lanka as of today has several signed and yet-to-be-finalised FTAs. These include the Economic and Technology Co-operation Agreement (ETCA), the Asia-Pacific Trade Agreement (APTA), the South Asian Free Trade Area (SAFTA), the Sri Lanka-Singapore FTA, the China-Sri Lanka FTA, the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Co-operation (BIMSTEC), and the Sri Lanka-Thailand FTA. Meanwhile, commenting on the national trade policy, de Mel said that it is currently being drafted and going through a consultation process involving all relevant stakeholders in Sri Lanka. Nevertheless, the country’s FTAs are unlikely to be signed and finalised until the policy is drafted. Giving the concluding remark, de Mel shared that there is exceptional potential of Sri Lankan exporters for trade and to expand their footprint in the global market, only if the right kind of opportunities are exploited and practised by them.


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