Speaking on behalf of the Exporters’ Association of Sri Lanka (EASL), EASL Chairman Harin de Silva welcomes the 2018 budget under Vision 2025 and its proposals to revamp Sri Lanka’s trade policies to enable an export-driven economy.
Apart from being more realistic, the proposals are expected to achieve a 5 percent growth rate while maintaining inflation at 6 percent and reducing the budget deficit to 4.5 percent of gross domestic product.
The new strategic brand of ‘Enterprise Sri Lanka’ looks at doubling exports to US $ 20 billion by 2020 and improve Sri Lanka’s rating to the 70th position in the global ranking of ‘Ease of Doing Business’.
The active promotion of the ‘hub’ concept along with further liberalization and deregulation will go a long way in assisting Sri Lanka enable Sri Lanka’s competitiveness in the global market through its value added re-exports.
The government’s endorsement of the national export strategy, which is based on a public-private partnership initiative in an effort to steer Sri Lanka away from a middle-income trap, is an encouragement to the export sector.
The proposal for an effective monitoring of the budget proposals in line with Prime Minister Ranil Wickremesinghe’s economic policy statement Vision 2025 is very welcomed.
Focus on the development and growth of small and medium enterprises (SMEs), together with the facilitation of an Exim Fund focus is critical for Sri Lanka to achieve the projected growth set out in this budget.
The EASL has continuously campaigned for these measures to be adopted at many forums.
Further, it has articulated these points in its strategic recommendations to the government in the form of (NEDEVS) highlighting the following points:
- Limited basket of products Sri Lanka has developed to match the internationally accepted standards
- Lack of appropriate incentives being offered, especially for SMEs
- Disconnect between the industry and educational institutions hampering innovation
- Inability to attract foreign direct investment, which brings in not only valuable funds but also technology and access to markets
- Suboptimal use of free trade agreements currently in place between Sri Lanka and foreign states
- Frequent increases in the cost of production, such as the cost of power, imposition of statutory charge accompanied by a wage structure that does not encourage the rewarding of employees on the basis of productivity, which in turn affects competitiveness
- Inconsistent policy and the lack of a political will to develop the export sector of Sri Lanka
- Lack of clear political objective and duplication of ministerial functions
- External global factors, which have a direct impact on Sri Lanka
The EASL is happy to note the acceptance and inclusion of the above by the government in this year’s budget.