Sri Lankan government decides to negotiate FTA with Malaysia
Newswire: Sri Lanka’s Cabinet approval has been granted to commence relevant negotiations for a Free Trade Agreement (FTA) between Sri Lanka and Malaysia.
According to the government, it has been recognized that the attraction of export-oriented foreign direct investments, diversification of exports and expansion of market access for goods and services is important to regain the economic stability of Sri Lanka.
Therefore, it is necessary for Sri Lanka to develop economic integration with countries that have strong and strategic economies, such as Malaysia.
Sri Lanka’s 34th export destination, Malaysia, is a key member of ASEAN and the Regional Comprehensive Economic Partnership. In the year 2023, the total value of exports to Malaysia was US$ 58.3 Million.
Considering the importance of reaching a free trade agreement between Sri Lanka and Malaysia, the Cabinet has approved the proposal presented by the President to begin relevant negotiations.
OSL take:
Sri Lanka is in the process of further strengthening and expanding the country’s trade ties by reviewing the existing trade agreements while negotiating new agreements with more countries. The many trade agreements as well as trade concessions enjoyed by Sri Lanka have helped boost the country’s exports sector while the country is working towards becoming a hub in the South Asian region. Sri Lanka signed a new free trade agreement (FTA) with Thailand earlier this year and is now negotiating an FTA with Malaysia and a preferential trade agreement (PTA) with Bangladesh. However, the strong trade ties enjoyed by Sri Lanka in the Asian region places the country as the best destination for foreign businesses/investors to set up base in to engage with other countries in the region. Foreign businesses could also look at forming joint ventures or partnerships with local businesses with the aim of trading with countries that enjoy agreements with Sri Lanka.