Think Tank says Sri Lanka may grow quicker by entering ITA deal
A think tank has statedin a report that Sri Lanka’s economic output may grow an additional 1.4 billion over the following ten years if the country reduced tariffs by entering the information Technology Agreement.
“Increasing the use of technology in all sectors of the economy is one of the most important drivers of economic growth in developing countries because it enhances productivity, spurs innovation, and bolsters living standards,” Vice President of Information Technology and Innovation Foundation, Stephen Ezell said in the report.
“If Sri Lanka joins the Information Technology Agreement, its businesses and consumers will use more technology products because of lower prices, while becoming more deeply integrated in global value chains for ICT production,” he stated.
“This will spur significant economic growth for the country and generate a substantial amount of tax revenue to offset any lost tariff revenue,” he added.
Sri Lanka had already communicated its willingness to enter the ITA and in July WTO specialists visited the country to educate relevant persons.
One of the aims motivating the country to enter the ITA is the ease of accessing world production networks.
According to the report it was possible to recover lost income resulting from tax cuts, with 47% coming back in 10 years.
“Countries that haven’t joined the ITA are missing a significant opportunity for economic growth, innovation, and prosperity. Joining the ITA makes countries more attractive locations for ICT goods and services producers and exporters, and sends a strong signal that these countries are open for business,” Ezell stated.
According to the report Indonesia, Vietnam and Laos had yet to enter the agreement.
OSL TAKE:
According to the benefits reaped from the ITA, Sri Lanka will become an attractive IT investment climate that will allow potential investors to also enjoy these advantages.
| Article Code : | VBS/AT/02102017/Z_2 |