Sri Lanka Passes Kenya in Tea Export Earnings in 2010

03rd February 2011, www.lankabusinessonline.com

Sri Lanka earned a record 1.37 billion US dollars in tea exports in 2010, exceeding that of Kenya, which exported more, owing to higher rices and more valued added shipments, brokers said.

The island's tea export earnings from exporting 314 million kilos were 16 percent more than in 2009.

Brokers Asia Siyaka Commodities said exports in 2010 were eight percent higher than in 2009 when drought reduced the crop.

The highest volume ever exported by Sri Lanka was 327 million kilos in 2006.

Kenya is the world's largest tea exporter, having edged past Sri Lanka a few years ago, but its earnings in 2010 were lower as its tea prices are lower than those of Ceylon tea.

"Interestingly, Kenya exported a highest-ever 441 million kilos in the year 2010," the brokers said.

"The approximate US dollar value was 859 million US dollars. Kenya produced a highest-ever 399 million kilos, a sharp improvement on the drought-crippled 2009 figure of 314 million kilos."

Kenya's export volume in 2010 therefore include at least 10 percent of other origin teas, the brokers said.

Sri Lanka restricts imports of teas for blending only to certain specialty varieties.

Asia Siyaka Commodities also said Sri Lanka's exports of value-added were around 65 percent of total exports and that a fall in exports to Russia, the biggest market, had been checked.

Exports in packets now account for 65 percent and total 143.9 million kilos. Exports in tea bags were nine percent of the total or 29.7 million kilos.

Green tea exports amounted to 5.7 million kilos, the greater proportion of which was in value added form, the brokers said.

Russia and other Commonwealth of Independent States rmained the top market for Ceylon tea buying 75.7 million kilos in 2010, an increase of 25 percent compared with 2009.

"The highest quantity exported to this region was 79 million kilos in 2006 and there followed a steady decline until the trend was reversed in 2010," Asia Siyaka said.

The United Arab Emirates was the second biggest importer of Sri Lankan tea even though buying a slightly smaller quantity of 30.2 million kilos in 2010.

Kenya Sri Lanka Signs Air Services Agreement Provides Unrestricted Frequency and Code Sharing for National Carriers

18th January 2011, www.capitalfm.co.ke

Kenya Sri Lanka have entered into a bilateral air services agreement that will see the trade imbalance between the two countries reduced.

Speaking during the signing ceremony on Tuesday, Transport Minister Amos Kimunya said the agreement provides for multiple designation and unrestricted weekly frequencies as well as code-sharing arrangements, which if fully utilised would provide an enormous potential to both countries national carriers.

"Kenya and Sri Lanka negotiated and concluded the first Bilateral Air Services Agreement in March 2008. This agreement laid the framework for direct access to the two economies that offer a combined market of over 60 million people. Our airlines could therefore benefit immensely by launching services between our two countries," said the Minister.

The deal, he added, was just one of the tools that the countries are adopting to increase trade among them.

"The latest figures we have are from 2007 in terms of our exports, stood at Sh495. 6 million as compared to 225.43 million for Sri Lanka. It is still a very small number, but we must appreciate that there has been challenges in terrorism in Sri Lanka and we have not had this connectivity. And part of boosting this trade is the signing of this agreement today," Mr Kimunya said.

He however pointed out that although small, trade volumes between the two states which are among the world's largest producers of tea had been on the upward trend for the past decade.

Sri Lankan High Commissioner to Kenya Jayantha Dissanayake said his country was willing to explore other investment opportunities and would send a task team to Kenya to inspect the possibility of establishing a vocational training centre in the country.

"I have also discussed with the Minister of Agriculture on the possibility of developing the coconut industry in Kenya because the country has very fertile land, similar to that of Sri Lanka, especially towards the coastline. It is extremely ideal for coconut cultivation," the envoy added.