Establish level playing field for Lankans prior to trade liberalisation: COYLE

The Chamber of Young Lankan Entrepreneurs (COYLE) yesterday issued a statement on trade agreements including the proposed Economic and Technology Cooperation Agreement (ETCA) with India. 

The COYLE, in its statement requested the Sri Lankan government to first establish a level playing field for Sri Lankan citizens, before proceeding with any further measures on trade or service liberalisation. 
Following are the key points listed by the COYLE in this regard. 

1. The necessity to establish a manpower regulatory mechanism
Under various trade agreements commercial presence of overseas companies is facilitated and foreign employees are permitted to be employed in companies established in Sri Lanka. 
We observe that there is no mechanism or institutional arrangement to assess the qualifications of such employees, regulate and evaluate the necessity and the suitability to be employed in the country and finally authorize and register them for employment. Since, the objective of facilitating such employment is to acquire special skilled manpower to the country, it is mandatory to establish a proper regulatory mechanism for assessing the manpower requirement of the country, evaluate foreign manpower and register them for employment. Such a regulatory body is non-existent as at present and that has to be established. Many other countries are maintaining efficient regulatory mechanisms. 

2. The necessity for scrutinizing and authorizing foreign investments

3. a) We observe that there is a gap in assessing real economic benefits to the country in terms of backward linkage, employment generation, technology transfer, environmental factors, etc., when foreign direct investment projects are approved by various institutions in the country. 
As at present, the investments that do not make any positive contribution to the country are getting in through various channels. Instead of making a positive impact, these investments continuously drain out foreign exchange reserves of the country, hindering real economic development. There is no need to allow foreign investments that will eventually deteriorate the economy.Hence, we believe that there is a dire necessity for establishing a single institutional mechanism for all foreign direct investmentd (FDIs), to scrutinize and evaluate the suitability to the country rather than merely looking at the face value of the investments.
b) We also request the government to revisit various investment provisions previously granted from time to time by the Sri Lankan government through gazette notifications in the past facilitating undesired foreign investments. 

4. The necessity for establishing proper domestic regulatory mechanisms with regard to all services liberalized under General Agreement on Trade in Services (GATS):
a) It is necessary to establish appropriate regulatory mechanisms in order to avoid negative consequences that may occur due to service liberalisation commitments made to the GATS. This will ensure a fair level playing field for domestic service providers against the foreign service providers.
b) It may also be necessary to negotiate with the World Trade Organisation (WTO) on the necessary rectifications of the Horizontal Commitments on the GATS. 

5. Urgency of activating anti-dumping measures in Sri Lanka
Sri Lanka is still to enact anti-dumping legislations in the country to control dumping of products causing severe injuries to domestic industries. Hence, there is an urgency to enact strict ‘anti-dumping’ legislations.

6. Need of an effective national 
trade policy
We strongly believe that the country’s international trade agreements should be aligned with the national trade policy. Hence, we request the government to first establish the national trade policy in consultations with all stakeholders and then prepare all trade agreements to be in line with that.
Such a national trade policy should also be mindful of mergers and acquisitions that may ultimately lead to unacceptable monopolised market positions. Hence, it is vital for the national trade policy to address this matter as well. 

7. Other necessary legislations
The ‘Way Forward to Liberalisation’ document prepared by the professionals of Sri Lanka has been presented to the government and the trade chambers listing out important areas to be strengthened prior to further liberalisation. We urge the government to make a serious note of these requirements and take the necessary steps to prioritise and facilitate these.