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Thursday Apr 18, 2024
Thursday, 13 October 2016 00:00 - - {{hitsCtrl.values.hits}}
By Uditha Jayasinghe
Sri Lanka, its Government, its private sector, its institutions are determined to advance broad-based, inclusive growth through trade International Trade Centre (ITC) Executive Director Arancha González said at the World Export Development Forum (WEDF) sessions yesterday.
ITC is the joint agency of the United Nations Conference on Trade and Development and the World Trade Organization dedicated to supporting developing countries succeed in international trade and investment.
The forum facilitates international trade and provides a platform for open discussions on the most pressing trade issues and challenges faced across the world, especially those in developing countries.
The two-day event, which is being held at the Bandaranaike Memorial International Conference Hall (BMICH), is themed ‘Trade for Success: Connect, Compete, Change’.
This is the 16th edition of the conference, which is organised annually by the International Trade Centre (ITC) and is co-hosted this year by the Ministry of Development Strategies and International Trade of Sri Lanka, through the Sri Lanka Export Development Board (EDB).
“Over the past year, Sri Lankan Export Development Board, and ITC, have worked closely to put together an impactful WEDF programme for you. Insights from global thought leaders in the private sector and government will enrich discussions to address concrete challenges facing businesses in navigating the world economy, enabling them to create more and better jobs. Carefully curated business matchmaking will be complemented by a programme of company visits and cultural highlights. We will discuss how to make trade possible,” she told the gathering at the morning sessions of WEDF that also saw the participation of Prime Minister Ranil Wickremesinghe, International Trade and Development Strategies Minister Malik Samarawickrama and EDB Chairperson Indira Malwatte along with a host of other dignitaries.
She pointed out the trade agreements of the 21st century must respond to the economic and social realities of the 21st century. In the current trade topography, globally production is dispersed in value chains that extend around the world. While this has created new opportunities for trade-led growth and job creation, tapping into value chains requires countries to address tariffs, but equally to open trade in services, from logistics, to telecommunications or to financial services, and tourism, the Executive Director said, adding Governments also need to address non-tariff measures, such as standards and regulations.
Trade synergies
“And in doing so, we must look at how we synergies trade opening at the multilateral level with regional trade agreements, which now includes so-called ‘mega-regional’ initiatives involving some of the world’s biggest economies,” she continued.
“But making trade possible is only a first step. There is still a need to make trade happen.”
Over the two days, participants will look at how governments can help trade and investment by improving the business environment. They would look at how trade and investment support institutions can provide targeted services to help businesses internationalise.
“And by focusing on the theme for this event – Trade for Success: Connect, Compete, Change – we will examine the three critical determinants for businesses to improve their competitiveness and use international markets to drive inclusive growth.”
Gonzalez went onto say digital trade has rendered entire services sectors tradable, liberating them from the constraints of geography. Even for physical merchandise, e-commerce has created new opportunities for ‘micro-multinational’ SMEs to link up to customers around the world. Yet much needs to be done to open the digital economy to all, from improving connectivity, to facilitating payment systems or organizing logistics.
To help businesses go digital, ITC and Alibaba launched a new publication spelling out how Asian firms – how Sri Lankan companies – can use e-commerce to break into the Chinese marketplace, which also took place during sessions on Wednesday.
“Alongside these transformations in investment and trade, a revolution is underway on the consumption side, as consumers increasingly emphasize social and environmental considerations in their purchases. We must ensure that we improve the quality of trade while supporting all business to match standards and regulations.”
The forums plenaries will be backed up by ‘in-focus’ sessions on logistics and innovation, each offering practical business cases and intelligence on how to connect, compete and change. “How-to” workshops and e-learning courses through ITC’s SME Trade Academy will provide an introduction to tools that will help companies or stakeholders better understand and reach new markets.
“We also want the forum to deliver concrete results, new business deals, new partnerships and expanded commercial and professional networks.”
On Tuesday, over 160 companies from Sri Lanka and from more than 30 countries around the world already started to explore potential deals. B2B matchmaking meetings have the potential to generate concrete results particularly in the specialty foods sector, tourism, IT and business process outsourcing.
“Before closing, I want to call attention to two issues that I hope will underpin all of our deliberations here. Both relate to ensuring that the benefits of the open global economy are broadly shared by all.”
“First, for trade to be truly inclusive, we need to ensure that women and youth are not relegated to the margins. The economic power of women and youth has yet to be fully tapped.”
One Belt; One Road
China would continue to support Sri Lanka’s development ambitions and would continue to partner the country going forward insisted Chinese Vice Minister of Commerce Wang Shouwen at the WEDF sessions on Wednesday.
Trade cost reduction to be promoted by the ITC led Trade Facilitation Agreement (TFA) could be more valuable for developing countries and they should join regional development measures, he advocated. Wang praised Sri Lanka Prime Minister Ranil Wickremesinghe’s efforts to negotiate new FTAs and pointed out that they would supplement World Trade Organisation (WTO) efforts and allow more development to filter through different countries.
“China has concluded 14 FTAs covering 22 countries and regions and all have expressed their satisfaction about the rapid growth with China as a result of the FTAs. Attracting investment is important to exports and FDIs being knowledge transition and therefore is a crucial part of driving indigenous innovation in local companies,” he said.
China has managed to attract $1.7 trillion in FDI that account for about half of China’s trade and 10% of tax revenue and 14% of China’s total jobs. This access to international market is unprecedented, Wang noted adding recently G20 members also stressed the importance of facilitating developing countries to enter and move within value chains.
Based on China’s experience links with WTO agreements has been beneficial and for the same reason many other countries are negotiating trade agreements with China. Promoting e-commerce is very important for developing countries, especially SMEs, he observed. This year a report by an organisation called B20 showed addressing barriers to e-commerce in developing countries could address access to exports for smaller companies.
“Since the One Belt initiative by the Chinese President investment and trade has grown faster with linked countries, currently accounting for a quarter of China’s trade and we hope that engagement will continue. ITC has been working with developing countries to enhance trade and China wishes to join hands with ITC to develop capacity of member countries and achieve the 2020 development agenda.”
Wang also assured Sri Lanka that China “is willing and very faithful” and would remain so as a partner to making a large number of planned projects by the Sri Lankan Government a success.
Access to ecommerce for SMEs
Policymakers and other stakeholders must work to deepen and give access of ecommerce platforms and build capacity of Small and Medium Enterprises (SMEs) United Nations Economic and Social Commission for Asia and Pacific (UNESCAP) Under Secretary Dr. Shamashad Akhtar said to promote sustainable development.
“The protracted global financial crisis has taken a toll in Asia and despite resistance there is a need to rejuvenate Asian economies. Asia at large is deliberating on how countries can position themselves in the landscape of world trade and how SMEs can be the solution to the problem,” she said.
SMEs have long been the backbone of Asian economies and account for 30% of trade and employ more than 60% of the population. Therefore giving SMEs competitiveness is crucial to drive job creation, she observed.
“Given the changing realities continued trade liberalisation and advances in IT has entwined to give great opportunities and challenges. Dynamism would be the way going forward. Unprecedented new opportunities have opened up to companies. Especially e-commerce platforms have given access to new consumers but they remain underexploited with less than 10% of companies selling their products online. Access to cheap data and information systems remains the biggest hurdle for smaller businesses that are also battling the rebalancing of China and remain well under the growth level.”
It has to be recognised that if the US-backed Trans Pacific Partnership (TPP) and other large trade agreements are enforced they will have an impact on Asian businesses. Such new changes would make operating in the world market even more complicated. Investment liberalisation will increase transnational cooperation but these have to have sustainable links with SMEs.
The presence of local SMEs with the potential to meet transnational cooperation, have corporate strategies would finally provide a holistic environment to attract FDI and facilitate access to technology. Several of these measures are underway and already being deliberated. The global Sustainable Development Goals (SDGs) must be infused and aligned with growth aspects.
“Responsible business models have to be developed to engage with SDGs and many of these can be SMEs. In many ways ESCAP is providing a solution to the slowdown in trade and as landmark agreements move forward they will work with regional members to harness seamless trade and euro-link advantages. China’s Belt and Road initiative will be supported by UNESCAP to take full advantage of these policies by the Chinese Government,” she assured.
– Pix by Upul Abayasekara and Lasantha Kumara
Prime Minister Ranil Wickremesinghe delivered a well-crafted and wide-ranging but concise address at the World Export Development Forum (WEDF) outlining the strategy of the Government and pledging to roll out strong incentives and policy in the coming weeks. The Prime Minister’s full speech is given below:
This forum is being held at an opportune time for Sri Lanka when we have decided to refocus our attention on exports, growth and expansion. Over the last few years we lost our focus on exports, we had GSP+, so did Bangladesh but we gave it up while Bangladesh continued and increased their export earnings significantly on garments by about five times.
We focused instead on foreign remittances but that is limited. When people want good jobs, they want to enter the middle class and they want better salaries and that can only come through exports not through remittances. Remittances will only send you a limited amount for a large number of people. So we missed those opportunities for growth, we missed the revenue; we depended on foreign debts, commercial debts and commercial borrowings.
Meanwhile the people in this country felt increasingly distressed, they had jobs but they were underemployed and the desire of the people to enter the middle class went unrealised. This is why the Government of Sri Lanka, headed by President Maithripala Sirisena has first focused on the political target of a million jobs and expanding exports. To achieve these targets in a short time we formed a joint Government. For us this is the war.
How do we get investments and how do we go out and capture export markets to give a future for our younger generations? With this in mind our first focus on making Sri Lanka the hub of the Indian Ocean for business, logistics and finance.
To make ourselves the hub of the Indian Ocean to make development of our three major ports in Colombo, Hambantota and Trincomalee and two large airports in Katunayake and Mattala, make the logistics streamlined for business and finance. This would make Sri Lanka a platform for competitive value addition and join global value chains, this in short is our strategy. We spent one year working out the details and most of them will be announced this month or next month with the Budget. 
One area of concern was the drop we had in the ease of doing business rankings but this too is being addressed. To back up Sri Lanka as the hub of the Indian Ocean our infrastructure is focused on one large corridor, Kandy, which will be expanded, into Wayamba and North Western to make use of the industries that will be part of the Western Megapolis project as well as export agriculture, fisheries and tourism. The Western Megapolis itself will be a mega city of 8.5 million people and it will have an offshore financial centre, which will be between Singapore and Dubai. These are actual goals; this is why we have a National Government.
Then we have the southern development focused on tourism, which is one of our low hanging fruits and on to Hambantota where the industrialisation of Hambantota is going on. A private public partnership for the Hambantota airport and the Hambantota port that will be a large expansion, which we are working with on the ‘One Road, One Belt’ policy of China. The second corridor we are developing is around Trincomalee, we want to build the Trincomalee harbour as an economic hub servicing the Bay of Bengal and look at industries and the vast potential of tourism. This in brief are our targets.
Then on Saturday I am leaving Sri Lanka to Brussels to reinstate the GSP+ agreement but unlike in 2002 when growth depended on Europe, the shift is now coming to Asia. We are working on three important agreements with India, China and Singapore. The Economic Cooperation and Technical Agreement (ETCA) will enable us to have closer engagement with India, especially the five southern states, which together with India is the fastest growing segment of the Indian Subcontinent and at the moment have a combined GDP of $500 billion so there is much scope with India and Sri Lanka working together.
We are negotiating another FTA with Singapore and they are receptive because they believe that Bay of Bengal countries will be fast growing countries with fast growing incomes in the next 20 to 30 years. Under the Chinese One Belt initiative with China we are also negotiating on a FTA and a comprehensive economic partnership dialog with Japan. This way we are already assured access to key Asian and European markets, as to how the US will develop we will know after November but we have made the plans on how to increase market access.
Then the incentives, which will be announced soon for foreign direct investments, and local investments to accelerate investments and one whole area that we will focus on and to give incentives for is the local manufacturing industry, to become competitive and grow. We have a fairly good manufacturing industry but they are catering to the domestic market but that will not create any more income. We have the potential to expand and grow into nearby market because our local companies know regional markets, well, who knows the regional markets better? So we are planning to give incentives to get new machinery, get more people and expand.
Tourism and the digital economy are ready to take off but have to be underpinned by human resource development. Our workers today have expectations, they want $300 minimum per month, this is their expectation, there are many jobs below this line but they are not filled because people want more. We will be focusing on this aspect too, to make sure that we have a larger consumer market in Sri Lanka.
SMEs need to be helped to take up more employment that may not be able to be absorbed by larger companies. We are doing this because we want a better life for our people, to have a secure future, and the best way to do this is via exports.
At a time when the global outlook is not favourable and we are a country where every billion dollars counts, our small size can be an advantage but it requires intense value addition. The first step was developing policies and with the Budget it will push people to perform better next year. I request feedback from participants to make a success of our new export strategy. Thank you.
Sri Lanka has to take advantage of its geographical location, human resources and dedicated Government to capture the chance for rapid economic development through exports and investment, International Trade Centre (ITC) Executive Director Arancha González said at the World Export Development Forum (WEDF) sessions yesterday.
ITC is the joint agency of the United Nations Conference on Trade and Development and the World Trade Organization. The speech given by Gonzalez at the inauguration of WEDF is reproduced in full below:
Subha udhaesanak! In case my attempt at Sinhalese failed miserably, good morning, and welcome to the World Export Development Forum!
On behalf of the International Trade Centre, I would like to extend our gratitude to the Government of Sri Lanka for partnering with us to host this sixteenth edition of our flagship event here in Colombo.
Sri Lanka, its Government, its private sector, its institutions are determined to advance broad-based, inclusive growth through trade.
And this is why, ITC, the joint development agency of the United Nations and the World Trade Organisation fully dedicated to supporting developing countries succeed in international trade and investment, is proud to stand by your side today.
Over the past year, Sri Lankan Export Development Board, and ITC, have worked closely to put together an impactful WEDF programme for you. Insights from global thought leaders in the private sector and government will enrich discussions to address concrete challenges facing businesses in navigating the world economy, enabling them to create more and better jobs. Carefully curated business matchmaking will be complemented by a programme of company visits and cultural highlights.
We will discuss how to make trade possible.
The trade agreements of the XXI century must respond to the economic and social realities of the XXI century. In the trade topography of today, we are seeing production dispersed in value chains that extend around the world. While this has created new opportunities for trade-led growth and job creation, tapping into value chains requires countries to address tariffs, but equally to open trade in services, from logistics, to telecommunications or to financial services, not to forget tourism. And to address non-tariff measures, such as standards and regulations.
And in doing so, we must look at how we synergies trade opening at the multilateral level with regional trade agreements, which now includes so-called ‘mega-regional’ initiatives involving some of the world’s biggest economies.
But making trade possible is only a first step. There is still a need to make trade happen.
Over these two days, we will look at how governments can help trade and investment by improving the business environment. We will look at how trade and investment support institutions can provide targeted services to help businesses internationalise.
And by focusing on the theme for this event - Trade for Success: Connect, Compete, Change – we will examine the three critical determinants for businesses to improve their competitiveness and use international markets to drive inclusive growth.
Digital trade has rendered entire services sectors tradable, liberating them from the constraints of geography. Even for physical merchandise, e-commerce has created new opportunities for ‘micro-multinational’ SMEs to link up to customers around the world. Yet much needs to be done to open the digital economy to all, from improving connectivity, to facilitating payment systems or organizing logistics.
To help businesses go digital, ITC and Alibaba will be launching a new publication spelling out how Asian firms – how Sri Lankan companies – can use e-commerce to break into the Chinese marketplace.
Alongside these transformations in investment and trade, a revolution is underway on the consumption side, as consumers increasingly emphasise social and environmental considerations in their purchases. We must ensure that we improve the quality of trade while supporting all business to match standards and regulations.
The forum’s plenaries will be backed up by ‘in-focus’ sessions on logistics and innovation, each offering practical business cases and intelligence on how to connect, compete and change. «How-to» workshops and e-learning courses through ITC’s SME Trade Academy will provide an introduction to tools that will help you or your stakeholders better understand and reach new markets.
We also want the forum to deliver concrete results, new business deals, new partnerships and expanded commercial and professional networks.
Yesterday, over 160 companies from Sri Lanka and from more than 30 countries around the world already started to explore potential deals. B2B matchmaking meetings have the potential to generate concrete results particularly in the specialty foods sector, tourism, IT and business process outsourcing.
Before closing, I want to call attention to two issues that I hope will underpin all of our deliberations here. Both relate to ensuring that the benefits of the open global economy are broadly shared by all.
First, for trade to be truly inclusive, we need to ensure that women and youth are not relegated to the margins. The economic power of women and youth has yet to be fully tapped.
This is why we have special sessions on youth entrepreneurship. And this is also why tomorrow the Colombo Stock Exchange will ring its opening bell for «SheTrades» in a ceremony hosted by EDB, the Women’s Chamber of Industry and Commerce and ITC.
The second inclusion I want to talk about is geographic. The world’s centre of economic gravity is returning to Asia. By 2030, an estimated two-thirds of the global middle class will be in Asia. But we need to ensure everyone shares in this process.
At the heart of Indian Ocean maritime routes, Sri Lanka is strategically poised between today’s growth poles in East and South Asia, and tomorrow’s growth poles in Africa. Sri Lanka cannot miss this opportunity to return to its rightful place in the trading routes.
Sadarayen piligannawa. Welcome to WEDF!
Thank you
