Liberalizing Imports of Foreign Orthodox Teas for Value Addition in Sri Lankan Tea Exports

The study, a part of an on-going project, focuses on the need for increasing value added tea in Sri Lanka’s exports. The study analyses the performance of a past policy initiative to promote higher value added teas under a duty free import regime for value added re-exports. The objective was to consider the re-introduction of such a policy in the future for promoting higher value added tea re-exports. The study attempted to calculate the value addition to the local economy from re-exports, and assess the views of local industry stakeholders on the suitability of a re-export regime for the tea industry. In addition, the study focused on a number of miscellaneous issues, including the suitable policy regime to promote re-exports, the tariff regime, a quota regime based on production, and the potential of an Export Processing Zone to promote manufactured exports.