The newly released five-year Export Barometer Survey by The Ceylon Chamber of Commerce highlights the strength of Sri Lankan exporters despite an uncertain global outlook. In a study covering 2023 and the forecast for 2024 exporters expressed confidence in their future growth prospects.

Despite the economic climate and a booming export market, the sector of exports showed significant growth in 2023. Exporters emphasized that rising prices for utilities as well as the expense of transportation and logistics created major challenges in 2023. Service-oriented exporters faced a shortage of skilled workers and highlighted a specific issue that merits further investigation. However, most exporters recognized new business opportunities that led to an increase in the number of workers needed to meet increasing demand for production.

Key Insights of the Export Barometer Survey

Strong Performance in Exports Continue

With the backdrop of economic growth in the world, the export industry showed an impressive growth rate in 2023. Many exporting businesses saw a significant increase in revenues as well as Small and Medium Enterprises (SMEs) becoming the main driving force behind this trend. Firms that were owned or run by women showed incredible resilience and maintained or grew their export revenues. In addition, most of these companies saw revenue growth within the 20 percent range.

Exporters Faced Significant Challenges

Exporters, regardless of sizes or structures of ownership have faced massive challenges that stemmed from rising utility costs and the increasing costs associated with logistics and transportation. These issues were prevalent across large companies and SMEs. Service-oriented exporters faced the lack of skilled workers which highlighted a particular sector-specific issue that deserves the attention of.

Improved Digital Adoption in Export Operations

Many firms, especially SMEs have embraced digital tools to enhance their export process. Businesses took a strategic approach to digital marketing to boost brand recognition and increase the reach of their markets. This demonstrates the industry's understanding of the importance of technology integration to ensure competitiveness.

Firms Identified New Business Opportunities

Most companies identified new business opportunities by 2023. Seventy percent chance were pursued by SMEs which demonstrates the sector's flexibility and ability to spot and capitalize on new trends. Furthermore, more than one-third of companies threw themselves into exporting innovative products and services to new markets, which reflects a strategic shift toward diversification.

Key Facilitation Required by Exporters

Stability in the political environment and the constant supply of energy were identified as essential facilitation requirements for optimal operations. The top five priority areas for facilitation include financial aid as well as market access assistance and the introduction of the market-determined exchange rate. Understanding these requirements is essential for both support and policymakers to adapt their strategies to the needs of the sector.

Exporters are Optimistic on Outlook

Despite global concerns exporters of Sri Lanka are optimistic regarding the export and economic growth prospects for 2024. Most of them anticipate moderate economic growth, reflecting optimism about the export industry. Over half of respondents have positive expectations about the cost of their goods in 2024. In addition, a significant proportion of companies plan to investigate 1 to 2 new markets internationally with being drawn to the Middle East emerging as an important target region.

Strategies for 2024

Looking forward to 2024, exporters are set to implement several strategic steps to increase export orders. One of the most significant is the implementation of an aggressive pricing strategy. This is followed by efforts to improve customer service and greater investment in marketing, with a significant focus on online advertisements. These strategies represent an effort from exporters to be competitive and take advantage of new opportunities in the changing international trade landscape.

Source: 5^th Export Barometer Survey by The Ceylon Chamber of Commerce, Edited and crisped.