50% of jobs in the export sector at stake due to the proposed electricity tariff hike
The Free Trade Zone Manufacturers Association (FTZMA) warned that Sri Lanka’s exporters would be compelled to cut the workforce by 30%-50% as a result of the proposed 60% hike in electricity tariffs this month.
The proposed electricity tariffs are scheduled to be presented to the Cabinet on the 2nd of this month. This is the second electricity tariff hike in less than six months. The government in August last year increased the electricity tariff by 76% percent.
According to reports, the country’s SME exporters are faced with a total collapse and the large-scale exporters are witnessing a 30% drop in export orders due global economic slowdown.
The FTZMA Secretary Dhammika Fernando said that the country’s export sector risks a total collapse due to the proposed hike in electricity tariffs and foreign exporters could relocate their operations to other countries that present much more attractive prospects.
The FTZMA along with other associations representing apparel exporters have already warned of the consequences to the President. Further, they have also held discussions with the Minister of Power and the Chairman of the Public Utiiris Commission (PUCSL). However, the Minister of Power hasn’t responded positively to the pleas of the exporters. Meanwhile, PUCSL Chairman Janka Rathnayake opined that there’s no requirement tariff hike.
Fernando urged the government to focus on minimizing corruption and waste at the Ceylon Electricity Board (CEB) instead of moving ahead with the proposed electricity tariff hike which could cripple the entire export sector.
According to Rathnayake, the PUCSL was yet to receive any proposals for a hike in electricity tariffs. He stressed that the electricity tariffs can not be increased based on various assumptions.