Business Times

Business with Jaffna: Walk before you leap

That's an apt adage when considering the prospects for trade and investment in Jaffna and the rest of the north, after the conflict ended in May 2009. These areas have either missed most of the economic boom and liberalisation that happened in post 1977 or saw just a little of it, in fits and starts. Soon after peace talks began in 2002 between Prime Minister Ranil Wickremesinghe's government and the LTE, hordes of businessmen began visiting Jaffna, the capital of the north, interested in trade and business opportunities.

Huge billboards suddenly sprung up advertising the likes of Aban, Singer or Dialog. Services moved swiftly particularly with a lot of money to spend, despite the ravages of a war. Who wouldn’t in a region that has been starved of the best things in life that the rest of the country enjoyed?

But it was all services and goods – financial, insurance, luxury consumer products like refrigerators/washing machines/televisions, etc, and banking – that attempted to swamp the province. There wasn’t any job creation. Captains of industry, corporate leaders and marketers were seen taking flights into and out of Jaffna – counting the profits they could make. There was no social commitment. It was essentially providing a service at a price in an untapped market. When peace talks collapsed, most of them ran away.

Then came the next peaceful phase when Tamil rebels were crushed by government soldiers last May, ending their 30 year-long campaign for separation. This time – with the Tigers being silenced for good (unless the government fails to provide a political solution to the crisis and the power sharing issue crops up again) - it is much different than in 2002 because there is no other obstruction to development, trade and business between the outside world and the north.

With access through the air and the long, and windy road to Jaffna being open, businessmen, banking officials and government hiararchy are once again storming the northern capital selling their wares, getting their pictures in the newspapers and generally getting more than their fair share of publicity and recognition. Sadly the people on the ground – Jaffna’s business community and civil society - are treated as bystanders in this game of showmanship.

The Sunday Times Business desk has repeatedly urged the Colombo community to treat the northerners with respect in terms of business, trade and investment linkages. In investment decisions and setting up manufacturing plants, the paper has consistently advocated the need to ensure northern investors have a bigger share of the pie and that most of the profits are ploughed back into the north for their development, sustainance and growth. We have pleaded, in the need for joint ventures, to have an equal share or more in favour of the Jaffna investor.

During a visit to Jaffna during the last Municipal Council elections, Jaffna chamber officials told a Sunday Times reporter that there is a lot of investment income in the region particularly through Tamil expatriates and any business project in the north (coming from outside) should be inclusive of investment from home-grown businessmen. Now an interesting study of the psychology and demography of some areas in the north and east reinforces our argument that northerners must be treated with respect and for products and investment not shoved down their throats.

The ground-breaking study, by Ogilvy Action and Nielsen to understand the needs and aspirations of those residents, has one comment that clearly sums up these concerns: “Judge me for who I am, not what I own,” says the study commenting on the priorities of residents where the acquisition of material goods is not a priority nor a reflection of social equivalence, unlike in Colombo and other developed Sri Lankan urban areas where acquisition of a posh house, nice car and other material goods are the goals.

The key points made in the study is that marketers and Colombo’s business community need to consider the needs and aspirations from the resident’s point of view, rather than a Colombo-centric or all-island vision. Some examples are that most of Jaffna’s residents watch South Indian TV channels and cable TV rather than local channels, a point for companies to consider in their marketing strategies. In terms of newspapers, the most widely-read newspapers are the Jaffna newspapers (the most vibrant newspaper reading culture is in Jaffna due to the thirst for news and information during the war years) and down the line, a small percentage for Colombo-based newspapers.

There is no market for Sinhala-language newspapers. However a word of caution here is that this data can change in coming years because Jaffna residents cultivated a culture of looking at Indian channels and read mostly Jaffna-based newspapers because access was limited. That can change with more access now.

The same applies to what drives the community (in terms of respectability and jobs). Here, the study shows, the desire is to secure a white collar job with professionals like Engineer and Accountants being respected. However IT has a growing demand as it requires very little infrastructure as long as communication is effective and judging by the number of Internet cafes in Jaffna, often filled with youngsters, this is a vocation that would draw a large number of school-leavers. A recent series of IT workshops in Jaffna to create awareness about the BPO industry drew some 4,000 school children which should help planners in promoting BPO start-ups and investments.

Jaffna is certainly waking up after the war but investors and traders from outside must put their (residents) needs and aspirations (as the study shows) before profit to ensure beneficial, socially-responsible and lasting relationships (and friendships)!

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