Sri Lanka is one of South Asia’s most prolific economies. Seeing mass economic growth in a short period of time, the country continues to improve. One of the reasons for this growth is its export industry.
Over the past decade, Sri Lanka’s export industry has picked up greatly from its standstill during the civil war. With an export industry reaching $15 billion in 2018, Sri Lanka now has the 63rd highest GDP in the world. So, what does this mean for you as a foreign entrepreneur? Simply put, it means it is now easier than ever for foreigners to set up their businesses in Sri Lanka. This is because the government of Sri Lanka wishes to maintain the growth curve that it has achieved. As such, many allocations for foreign investors have been made.
As the export industry in Sri Lanka continues to grow, more companies are needed to facilitate the smooth exchange. As such, the popularity of export businesses has risen. Moreover, even as a foreign national, starting a business in Sri Lanka will not pose as difficult. Especially with regards to communication as English is one of the country’s official languages. Thus, an export business as a foreign national can be ideal.
If you’re interested in starting an new export business in Sri Lanka, you will need to take certain steps. Before we elaborate, it would be best to define what exactly an export business constitutes of. An export business or an export/import business is a company that arranges for goods and products to be exchanged and traded between domestic companies that need to buy them and foreign companies that need to sell them. This also works vice versa. In simple terms, they also act as a shipping business.
The export industry in Sri Lanka
The export industry in Sri Lanka continues to grow. While it was previously heavily reliant on only raw materials, the country now has moved to secondary sector products as well. Now worth more than $15 Billion, the country’s main exports are tea, apparels, textiles and various spices. They also have an illustrious rubber export business. As of 2018, the country’s main export partner is the USA, which is then followed by the UK and then India.
Thus, it can be seen that it is quite an illustrious sector to join. As an entrepreneur who wishes to start a business in the export, you will have to first choose a legal structure for your business. In Sri Lanka, foreign entrepreneurs have the following legal structures to choose from:
- The limited liability company
- The sole proprietorship
- The partnership
Next, you will have to narrow down what products you will be having on offer for your export business. This is because depending on what you facilitate the trade of, you may need certain licenses. These licenses are especially important in the export and trade of restricted goods such as medications and certain chemicals.
So how do you registering your export business in Sri Lanka? Below are some steps you may use as a guideline:
Register business with the ROC
The first step is to officially register your business with the Sri Lankan companies registrar. For this step you may choose to register online or an appropriate ROC office. Once you file the application with the relevant documents, you will receive your certificate of registration.
Register as an exporter
After you have your certificate of registration, you will need to register yourself as an exporter.
For this, you will need to register with the following departments:
- The Export Development Board of Sri Lanka
- The Inland Revenue Department of Sri Lanka
- The Customs office of Sri Lanka
To register with them, you will simply need to show your certificate of registration. In addition to this, you will also need filled in application forms of the product category you wish to export. These forms will be available at the departments above.
Note: You may read this for small business registration in Sri Lanka – A step by step guidelines
Get appropriate licenses
Once you’ve acquired your appropriate export licenses, you may begin your business activities. These documents may have to presented at any moment during the export process.
Now that you have all the licenses and certificates, congratulations! You may officially begin your business. At this point it would be best to identify your customers. This is so that in the long run your cost of production may be minimized as you will only need to have enough inventory for your customers,
Market to customers
Once you have your customer base identified, you may begin your marketing strategies. This is especially important as your brand reputation also depends on your marketing. A good marketing strategy also brings in new customers for you. Thus, enables you to expand your business.