Sri Lanka needs a more comprehensive system of trade agreements: Minister

Minister of Development Strategies and International Trade, Malik Samarawickrama addressing the Sri Lanka-Singapore Business Forum

Even in the 1960s, there had not been much difference between Sri Lanka and Singapore in terms of development, but today Singapore has a GDP per capita of US$ 57,000.   This is proof of Singapore’s success and there is a lot that Sri Lanka can learn from that South East Asian country, said Minister of Development Strategies and International Trade, Malik Samarawickrama, at the Sri Lanka-Singapore Business Forum held recently

The Minister added that in the 1970s Sri Lanka was a pioneer of liberalization but unfortunately the country has acquired an anti-exports bias in recent years.   He also said that Sri Lanka also has not attracted very much FDIs when compared to South East Asian countries.   Hence the policy of the Government of Sri Lanka is to develop the country to make it much more competitive.  

“Sri Lanka will therefore, build up its macro-economic fundamentals, and create new trade frameworks with the aim of boosting exports.  In the future, efforts will be made to eliminate some of the tariffs.  Sri Lanka does have many advantages such as an excellent location and excellent ports.  The customs have been modernized through the introduction of ASYCUDA and the One Stop shop at the Central Customs Clearance Unit.  

“But what is needed now is a more comprehensive system of trade agreements.  A total of 50 percent of global trade is in fact dependent on trade agreements.  Currently, Sri Lanka has trade agreements with India and Pakistan and in the future it is proposed to have an agreement with China.  The restoration of GSP+ with the European Union is expected later this year.  

Minister Samarawickrama said that a 5-year programme to increase trade and investment with the US will be launched later this year.Sri Lankan officials are working on an FTA with Singapore.  We can expect such measures to benefit Sri Lankan exporters and also consumers who will have access to better quality goods at low prices.  

“The Singapore Company, Surbana Jurong, has developed a new Megapolis plan for Colombo.  Singapore FDIs is currently about US$ 100 million. There is, therefore, lot more than can be done in that respect.  

The Minister of Trade and Investment of Singapore. S Iswaran also spoke.  He added that Singapore has celebrated 50 years of independence, and is working towards maintaining its relevance and growth.  

One of the first companies from Singapore which invested in Sri Lanka was the Prima Group who set up their mill in Trincomalee.   Many other companies from Singapore have opted to invest in Sri Lanka.  Singapore had invested altogether US$530 million in Sri Lanka and interestingly Sri Lankan companies have invested US$120 million in Singapore.  So FDI is in fact a two way process between the two countries.  

Singapore has also benefited considerably through FTAs and is connected to the ASEAN region which is growing at 5 percent annually.  And this has been benefiting all members of ASEAN.  Minister Iswaran said that Prime Minister Ranil Wickremesinghe wanted an FTA with Singapore and the Singaporean side also shared this view.