Sri Lankan companies which succeed will be those that adapt and comply with new rules which might even enable them to gain market share from those which do not, he told an investment forum held alongside the island's Expo 2012 trade fair.
Exporters in developing countries were becoming concerned about new environmental and sustainability regulations that they viewed with suspicion as being new forms of protectionism.
"They are seeing new standards related to the environmental sustainability of the products they export - the 'greenness' of their products, to use today's terminology - as the latest barriers o trade with developed countries," said Clarence-Smith, UNIDO's representative in China.
"I do not believe this to be the case. Yes, no doubt certain counries, or certain companies within countries, are trying to use gren product standards as a way of blocking, or of at leasr braking, imports.
"But overall, what we're seeing here is a major shift in environmental - or more broadly sustainable - policies worldwide."
Such regulations which earlier focused on reducing industrial pollution and improving energy and resource efficiency, were not focusing on products and modifying consumotion behaviour.
"The exporters who will continue to be successful in the future wil be those who ake on board these new green expectations of both their products and their industrial processes," Clarence-Smith said.
"In so doing, they will continue to have access to their export markets. In fact, they will probably even gain market share from those exporters who fail to follow these newest trends."
Clarence-Smith said it was important for governments to provide the necessary support to exporters to comply with new standards in importing countries.