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Sri Lanka experts call for increased focus on global trade

Sri Lanka experts call for increased focus on global trade

The Morning: During the recent discussion organised by The Ceylon Chamber of Commerce (CCC), between the negotiating team of the Sri Lanka-Thailand Free Trade Agreement (SLTFTA) and industry experts, the industry expats called for increased focus on the FTA for Sri Lanka’s economic growth.
Accordingly, Ceylon Chamber of Commerce Chairman Duminda Hulangamuwa, while stressing the importance of facing global market competitiveness, emphasised that Sri Lanka needs to explore and leverage agreements strategically to be competitive with countries like Vietnam, Thailand, Malaysia, China, and Singapore. He asserted that sustained international trade growth can lead to an 8-9 percent economic growth rate, and the nation cannot rely on 2-3 percent growth.
Chief Negotiator K. J. Weerasinghe, on the other hand, underscored the need to align with the government’s vision for global market access and attracting investments. He outlined a three-pillar strategy focusing on protecting and promoting existing trade partnerships with the US and European Union, expanding market access in South Asia with countries like Bangladesh, Pakistan, China, and India, and increasing market access in East Asia with Thailand, Malaysia, and Singapore. He acknowledged that Sri Lanka lost opportunities on the trade side in the last five years, and emphasised the need to act swiftly to capitalise on future opportunities.
Drawing similarities with Sri Lanka’s FTAs with Thailand and Singapore, BOI DG and Head of Investment Chapter Renuka Weerakoon, highlighted the comprehensiveness of these FTAs, covering areas such as trade facilitation, services, proceedings, Sanitary and PhytoSanitary (SPS), Technical Barriers to Trade (TBT), investment, trade remedies and intellectual property. She emphasised that FTAs are crucial for Sri Lanka, given its small domestic market, and can lead to increased market access, Foreign Direct Investment (FDI), job opportunities, foreign exchange, innovation, technology transfer, and international trade networks. She also emphasised the expectation of increased Thai investments in manufacturing and services under the recently signed SLTFTA.
Ministry of Finance Advisor and Head of Trade in Services Chapter Deshal de Mel emphasised that the SLTFTA is part of a broader strategy to drive qualitative changes in Sri Lanka’s economic growth.

OSL take:
Sri Lanka’s move to strengthen the country’s existing trade ties while forming new trade ties are bound to make the country a trade hub in the region. The country’s strategic positioning in the Indian Ocean and the strong trade ties enjoyed by Sri Lanka with other countries have supported the manufacturing and export sectors as well as the expansion in the country’s overall economy. It is in such a backdrop that experts have called on Sri Lankan authorities to focus more in global trade. Given Sri Lanka’s unique relationships with the countries in the region, foreign businesses/investors looking at doing business in the region could look at setting up base in Sri Lanka to engage with other countries using the preferential treatment enjoyed by Sri Lanka when trading with those countries. Sri Lanka’s expanding economy and the business conducive environment could provide a further boost for foreign businesses setting up operations in the country. Given the growing business potential in Sri Lanka and the growth in trade, foreign businesses/investors could explore the expanding opportunities in the island.

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Article Code : VBS/AT/20240315/Z_7

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