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Political uncertainty is keeping business confidence tepid, Sri Lanka’s largest business chamber said this week, but supported the Government’s reform process including inking free trade deals whilst calling for better policy implementation to formulate change.
Ceylon Chamber of Commerce (CCC) Chairman Rajendra Theagarajah addressing the 179thAGM on Thursday described 2017 as a challenging year that pushed the private sector to balance both external and domestic risks.
“While macro stability has been achieved to a great extent with higher level of reserves, FDI and exports reaching all-time highs in 2017, business confidence has been tepid in the backdrop of political uncertainty. We have also seen a semblance of policy congruence in recent policy documents brought out by the Government which has been lacking in recent years. As we have highlighted in numerous forums and submissions, the credibility of Government policy will solely rest on the effectiveness of its implementation,” he told the gathering.
The Chairman emphasised that the economy presently faces numerous challenges. He noted the country’s GDP growth has been below 4% for five consecutive quarters and the rupee has been under pressure against the US Dollar, which is a common trend of emerging and Asian currencies. He pointed out that Government reforms have also seen a slowdown on reform initiatives such asCustoms Ordinance and State-owned enterprise reform.
“Having said that we have seen progress in terms of trade and investment facilitation. The Chamber favours an outward orientation of the economy which involves deeper engagement with countries such as through bilateral Agreements such as FTAs. The recently-signed FTA with Singapore along with the legislation on Anti-Dumping and Countervailing Duties and Safeguard Measures are examples of this.”
Moving to Free Trade Agreements (FTAs), Theagarajah noted the Chamber had facilitated many meetings for the negotiating team to consult with private sector stakeholder groups and is currently studying the text of the Singapore FTA to provide a “responsible view and opinion which is missing in the current discourse in the public domain”.
“The discussion while focusing on national interests should also be based on sound facts in the context of the overall development strategy for the country taking into account the trade and investment nexus. Irresponsible statements that are not based on the truth should be avoided.”
The chamber would continue to engage in the process of private-public dialogue, voice their concerns to Government and policymakers and be an enabler in progressing Sri Lanka’s economic development agenda, he added.
From left: Ceylon Chamber of Commerce Immediate Past Chairman Samantha Ranatunga, Vice Chairman Dr. Hans Wijayasuriya, Finance Minister Mangala Samaraweera, Ceylon Chamber of Commerce Chairman Rajendra Theagarajah, Deputy Vice Chairman Vish Govindasamy and CEO/Secretary General Dhara Wijayatilake
The CCC Chairman also called on the private sector to be harbingers of harmony and work to prevent communal clashes from erupting around the country.
“I would like to take this occasion to urge all the stakeholders to be united in preventing violence and propagate harmony amongst communities. Sri Lanka’s development will be adversely hindered if we see recurrence of events that transpired in Kandy during March.”
Following is the full text Theagarajah’s speech at the Ceylon Chamber of Commerce Annual General Meeting.
On behalf of the Ceylon Chamber of Commerce, it is my distinct pleasure and privilege to welcome you all to the 179th Annual General Meeting of the Ceylon Chamber of Commerce.
We are privileged to have with us the Hon. Minister Samaraweera to grace our AGM as the Chief Guest. Under your leadership and with the stewardship provided by the Governor of the Central Bank of Sri Lanka, we have seen a significant improvement in the macroeconomic fundamentals and a positive shift in the economic narrative for the country. Our hope is that programs such as ‘Enterprise Sri Lanka’ and ‘Gamperaliya’ (Village Transformation) will bring up the next generation of entrepreneurs and drive economic development to the village.
Last year was a challenging year for the private sector and our members balancing both external and domestic risks. While macro stability has been achieved to a great extent with higher level of reserves, FDI and exports reaching all-time highs in 2017, business confidence has been tepid in the backdrop of political uncertainty. We have also seen a semblance of policy congruence in recent policy documents brought out by the government which has been lacking in recent years. As we have highlighted in numerous forums and submissions, the credibility of government policy will solely rest on the effectiveness of its implementation.
I would like to take this occasion to urge all the stakeholders to be united in preventing violence and propagate harmony amongst communities. Sri Lanka’s development will be adversely hindered if we see recurrence of events that transpired in Kandy during March 2018.
The economy presently faces numerous challenges. The country’s GDP growth has been below 4% for five consecutive quarters. The LKR has been under pressure against the US dollar this year, a trend we have seen with most emerging and Asian currencies. We have also seen a slowdown in certain reform initiatives such as the customs ordinance and state-owned enterprises.
Having said that we have seen progress in terms of trade and investment facilitation. The Chamber favors an outward orientation of the economy which involves deeper engagement with countries such as through bi-lateral Agreements such as FTA’s. The recently signed FTA with Singapore along with the legislation on Anti-Dumping and Countervailing Duties and Safeguard Measures are examples of this. On FTAs, the Chamber facilitated many meetings for the Negotiating Team to consult with private sector stakeholder groups and is currently studying the text of the Singapore Agreement to provide a responsible view and opinion which is missing in the current discourse in the public domain. The discussion while focusing on national interests should also be based on sound facts in the context of the overall development strategy for the country taking into account the trade and investment nexus. Irresponsible statements that are not based on the truth should be avoided.
Hon. Minister, the effort made by the Ceylon Chamber demonstrates our commitment to contribute towards the national development agenda of the Government. Your address this evening will no doubt add great value to the audience and guide the private sector in the year ahead.
The Chamber will continue to engage in the process of private-public dialogue, voice our concerns to government and policymakers and be an enabler in progressing Sri Lanka’s economic development agenda.
