Value Added Manufacturing
Being in line with the National Economic Development Strategy, the BOI Sri Lanka has positioned the value added manufacturing sector at the focus of its investment promotion strategy. In this context, having identified the multiplier effect, a special effort has been taken in promoting high-tech manufacturing industries, which would generate a positive impact on stakeholders in supply chains covering both backward and forward linkages.
With a significant contribution of 27% to GDP and 18% of total employment, the industrial sector in Sri Lanka is the prime force of value creation in the economic development of the country. Out of the four sub sectors of the industrial sector; Mining & Quarrying, Manufacturing, Electricity, Gas & water and construction, the manufacturing sub sector accounted for over 59 % of the output of the industrial sector and 15.7 % of the country’s GDP.
Export earnings of USD 8.5 Bn in 2017, which is 75% of national export earnings, has made the manufacturing sub-sector more significant in the country’s economy. The major contributors of the sub-sector in this context were apparel, rubber, petroleum products, diamond & jewelry, food & beverage and machinery & equipment. The major export destinations for the Sri Lankan manufacturing sub-sector in 2017 were USA, UK, India, Italy, Germany, Belgium, UAE and Russia.
Considering the significant impact the sector would place on Sri Lankan economy, the BOI promotes Industries where the country’s value proposition is seen to have clear advantages and a compelling business case – in terms of quality, quantity and cost of supply. Accordingly, the following sectors have been identified for promotion towards enhancing value-added exports:
|Electronics, Electrical, Machinery||Solar panels and components manufacturing; Printed circuit board assembly and SMT; Industrial production equipment|
|Insulated wires and cables; Electrical panel boards & enclosures; washers, coil springs, nuts and bolts; machine tools and components, Vehicle sensors, signaling & starting equipment|
|Automotive||Auto parts (including electric car components); Vulcanized rubber articles; wire harnesses; seat belts|
|Ships, boats and related||Yacht, sailboat, lifeboat, motorboat building; Water sport equipment manufacturing (e.g. kite sails)|
|Medical, consumer, other||Pharmaceuticals: Medical devices|
|Mineral products||Mineral products in value added form|
|Food Processing||Dehydrated fruits & vegetables, Coconut based products, Spice Processing, Aquaculture|
In addition to the above target sectors, the following have been identified for value added manufacturing for export markets:
- Fabricated Metal Products
- Glass and Ceramic Wear and Gem and Jewelry
- Marine/Fishing Gear and Accessories
- Footwear and Leather Products
- PVC and plastic Products
- Coir related Products
- Animal Feed
- Rubber based products
- Wood based products
- Construction related equipment & material
- Hand tool components