E-commerce Readiness Assessment Report Sri Lanka was launched by the Commonwealth Secretariat (COMSEC) in collaboration with the Sri Lanka Export Development Board (EDB). The report is the result of a request by the EDB in 2018 for technical assistance from COMSEC to conduct an e-readiness assessment for Sri Lanka and undertake capacity-building programmes on e-commerce for SMEs and women entrepreneurs.
The project was funded by COMSEC through the Commonwealth Fund for Technical Cooperation (CFTC). The publication comes at a time when businesses in Sri Lanka were compelled to exploit e-commerce mechanisms in the wake of lockdowns and travel restrictions due to COVID-19.
The project was led by Opeyemi Abebe, Adviser and Head – Trade Competitiveness Section, COMSEC. The input for the report was obtained from extensive consultations with several stakeholders, including government agencies and organized private sector business enterprises.
As part of compiling the report, a sample survey was undertaken to obtain data on e-commerce technology infrastructure, logistics and transportation, e-business modelling, technology uptake by businesses, availability of technology support services, and e-payment. The sample included 92 firms from various sectors, including banks, financial institutions, logistics and transport companies and e-commerce service providers.
Furthermore, the relevant policy and technical documents were also reviewed to collect the required data. Two stakeholder validation workshops were held to present the draft report to the stakeholders and obtain their feedback, which was then included in the final document. The data obtained from the sample survey and document study was assessed by a five-parameter model to determine the present state of maturity of e-commerce in Sri Lanka.
The model covers citizen maturity, business readiness, IT infrastructure and accessibility, logistics and delivery, policy and regulations, and it gives five levels of maturity or readiness for each of the five parameters.
Overall, the study found that in spite of the optimism among businesses with regard to the use of e-commerce, the present state of e-commerce development in Sri Lanka is basic.
However, the report noted that the potential for expansion, both for the domestic market and cross-border trade, appears to be enormous. Citizen maturity for e-commerce was observed to be at the basic level and as per the report, challenges prevail with regard to low internet availability and low usage of e-payment due to lack of awareness, skill, and trust. Business readiness for e-commerce has also been ranked at the basic level, as businesses score low in terms of availability of skills, know-how and technology infrastructure as well as on the adoption of technology for selling and buying. In respect of logistics and delivery, the publication noted that although some logistic firms are using information and communication technology, it was not the case for the entire delivery chain.
“Lack of resources, skills, know-how and awareness, and indeed lack of automation in material handling is a major challenge facing firms in relation to effectively supporting e-commerce”, the report noted.
Nevertheless, IT infrastructure and accessibility and policy and regulations parameters have been assessed at a higher level of maturity than the other three parameters by the publication. According to the report, Sri Lanka’s internet penetration – which is currently at 30% – has to rise and high bandwidth must be made available to increase the digital population. “Meanwhile, although Sri Lanka has already enacted the necessary laws and policies on all the subjects relevant to e-commerce, a fresh review of these will be necessary to remove inconsistencies and conflicts that exist between these and the corresponding civil and criminal laws of the country, and to optimize them to meet the needs of the country”, the publication observed in relation to policy and regulations.
The report recommends a strategic plan for e-commerce development and added its implementation is necessary to overcome the challenges faced by the country. “The proposed strategic e-commerce development programme could bring under a single umbrella all policy, regulatory, skill development, awareness-raising, investment and other systemic actions that must be taken to unlock the considerable potential for e-commerce in Sri Lanka”, the publication emphasized.
The EDB’s IT division coordinated the necessary meetings and consultations to facilitate the development of the report. The publication can be viewed online from the EDB website – www.srilankabusiness.com(https://bit.ly/33BDGDN)