Competence of embassies key to promoting tourism, exports and investments

In an increasingly interconnected global economy, economic diplomacy has an integral role to play in foreign policy. Countries that have recognised this and adapted their foreign policy have reaped the benefits of strengthened economic and trade relations, promotion of the interests of their economy and companies, and enhanced international profile. 

However, this needs to be underpinned by all of the country’s Foreign Service resources, in coordination with its public administration in order to increase tourism exports, and investments. Sri Lanka, with over 55 missions in non-Commonwealth and Commonwealth countries, 13 consulates and three permanent missions at the United Nations must maximise the impact of its economic diplomacy efforts. 

To this end, the International Chamber of Commerce Sri Lanka and the Daily FT in association with Sri Lanka-China Business Council, the CSE, and the European Chamber of Commerce of Sri Lanka, organised a webinar on ‘The role of missions in promoting tourism, exports and investments’. This article encapsulates the 10 key recommendations and observations made by the speakers and panellists in this webinar.

Understand the environment

In his keynote, Robert Blake highlighted the importance of economic diplomacy for every country, observing that ‘on the ground’ staff are vital for developing connections with those interested in business. He emphasised the need to be proactive and reach out actively, ‘making sure most of the time is spent outside of the office’. He encouraged diplomats to introduce themselves to think-tanks, and Chambers of Commerce, cultivate good relationships with government decision makers and regulators in order to alleviate lack of knowledge and fear of challenges, as well as match-make with good business partners.

Crispin Conroy supported this, underscoring that getting to know home and host country business environments, their strengths and key sectors and market gaps, can create great opportunities for policy change. He noted that diplomats should meet the people and understand their business language, saying ‘talk to business, listen to business’, and citing the case study of the Australian business community in Chile who sought an ambitious commercial engagement strategy from the Australian government, which had initially prioritised Asia. Riaz Hamidullah also noted that Europe and the rest of the world are not a monolith, so ‘understanding other sides’ language and values is very important’.

Adopt a holistic approach

The speakers and several of the panellists stressed the necessity for a seamless relationship and common narrative between diplomatic missions, investment promotion agencies and national authorities with whom overseas partners would have to deal in the country. Crispin Conroy, Rohitha Bogollagama, Sashikala Premawardhane, Sanjay Mohottala, and Lakshman Hulugalle underscored how important this holistic approach and connectivity is for consistency and credibility with investors. 

On engaging with the Chambers of Commerce and other business associations, Jurgen Morhard revealed that all Chambers are important partners because of their ability to leverage their membership and create fora in which awareness can be raised about a country’s trade and investment opportunities and tradeshows. 

Sashikala Premawardhane and Saroja Sirisena shared success stories of opportunities created within Singapore and the UK. Sanjay Mohottala also observed that networks should be transferred when missions or commercial attachés change, rather than being the implicit knowledge of any particular individual within the service, adding that continuity, AI and CRM could be considered.

Invest in relationships

Crispin Conroy’s statement, ‘trade and investments are ongoing relationships rather than one-off transactions’ was supported by several panellists, with observations that trade must be bilateral, deepening beyond unilateral trade concessions. While they noted that the host countries were understanding of the current circumstances, trade restrictions are temporary measures and bilateral trade would need to recommence once the economy stabilises. Rohitha Bogollagama shared his experience that in challenging times with regard to Sri Lanka’s image, ambassadors kept consistently engaging with stakeholders with both those who were negative toward the country, not just with those who had positive impressions and that this brought results.

Draw on complementary capacities

Li Guangjun reflected on the need for openness and inclusiveness rather than isolation and discrimination, stating that over a hundred countries have established cooperation with China under the BRI, based on the ‘principle of extensive consultation, joint contribution and shared benefit, under win-win cooperation’.

Fielding a question on potential overdependence on one country, Palitha Kohona pointed out that Sri Lanka has invited companies from the world over to invest in various projects. He said that it just happened to be that the interest in Sri Lanka has been mainly from Chinese companies, and that a claim of overdependence would be an oversimplification. He reiterated the opportunities for business in Sri Lanka, including its location and its status as a hub in the region.

Rakesh Pandey remarked that India could be a bridge, connecting the supply chains of Sri Lankan and Indian companies, supported by complementary strengths, proximity and cultural similarity.

Most panellists noted that Sri Lanka is well-placed to be a connector within the region, forming relationships with other countries and offering access to new markets.

Train for service

In order to fulfil the demands of such multifaceted roles and meet the exigencies of the times, the guests remarked that training is critical. Bernard Goonetilleke noted that the responsibilities are quite wide and a university graduate joining the Foreign Service would not be equipped to undertake these unless provided with requisite training. 

He recommended that a high value be placed on training and re-training, and that training institutions should be properly equipped, properly staffed, and properly financed to enable young diplomats to take on such responsibilities. Laksiri Mendis made the observation that the service has a good mix including digitally-oriented young people, Foreign Service personnel, and ‘outsiders’, which makes it stronger and more viable. 

Foster governance

Robert Blake pointed out that governance is an essential part of doing business these days and con-tributes to the ease of doing business. He also stated that while many governments are cracking down on NGOs, the most successful countries at attracting the business are the ones with good governance, independent rule of law, and a solid business climate. This was corroborated by Riaz Hamidullah who cited values as an essential ingredient in successfully fostering trade relationships with Europe.

Work with multilateral agencies

Multilateral agencies can help in this process, and Crispin Conroy spoke of initiatives the World Trade Organisation (WTO) is putting in place to produce relevant rules for the modern world in an agile and effective manner around e-commerce, SMEs, and investment facilitation for development. Rohitha Bogollagama speaking on engaging with the IMF recommended that the Government should weigh any strictures that are applied to the country, consider what is required to tide Sri Lanka over the current deficit and emerge from the situation, and take a pragmatic approach in the larger interest of the economy. 

Engaging with an international body such as the IMF, he said, would lift Sri Lanka’s image, which would lead to other countries and other agencies respecting Sri Lanka’s profile in terms of wider engagement with the international community. Robert Blake suggested that multilateral agencies sometimes offer commercial opportunities too, a prospect which is often neglected. He also recommended that it would be wise to work closely with them to improve rankings such as the ‘Ease of Doing Business’.

Showcase strengths

Several of the other panellists also remarked on communicating with rating agencies to showcase the country’s strengths, with Sanjay Mohottala encouraging the country to have a holistic engagement with rating agencies, and create dialogue to understand where they see concerns and where they see opportunities since communication is vital. Rohitha Bogollagama agreed that while rating agencies have their own criteria for rating, communication can help explain some of these, and engaging with the agencies would have better results than ignoring them. Rajeeva Bandaranaike added that a plan to work collectively toward better ratings would perhaps be taken into consideration if it is evident that steps are being taken.

As some of the main expectations of a foreign mission are to communicate the home country’s potential, connect and create awareness of investment landscape and process, guests shared the initiatives already in effect. This includes the leveraging of digitisation and social media as well as promotional campaigns to keep Sri Lanka at the forefront of customer awareness for when borders open and allow for increased interaction. Measures taken for tourists to see Sri Lanka as a safe destination with good infrastructure and medical facilities was discussed, as well as webinars to showcase the country as a manufacturing hub and investment destination.

Involve diaspora

Outreach to members of the diaspora and awareness programs conducted through them, especially those active in the country also serve to reinforce business confidence in Sri Lanka, because as Saroja Sirisena observed ‘there’s nothing that speaks better than actual stories of people who are doing business in Sri Lanka’. She revealed that the diaspora of nearly half a million British Sri Lankans has been a strong source of support, including in the IT sector through the referral program with SLASSCOM. She also spoke of initiatives leveraging alumni networks, allowing them to handhold SMEs and micro-industries bringing new products to the UK, increasing Sri Lanka’s exports.

Be future-focused

The digitisation of services and increase in accessibility was only one aspect of the forward-looking approach recommended by the guests. Keeping pace with digitisation is the growing global cybersecurity threat. Sashikala Premawardhane cautioned that the governments of countries vulnerable to cybersecurity attacks need to invest in upgrading their cybersecurity networks and putting in place mechanisms, because if they don’t invest in cybersecurity at this time, they would lose out in the long run because an attack in cyberspace could really cripple economies.

In order to prevent further losses, Palitha Kohona stressed that Sri Lanka must take cues from the rest of the world in focusing on renewable energy, and step away from fossil fuels. This would also save foreign exchange used in the importation of coal. He suggested that once the country’s energy needs were addressed, further opportunities could be sought, including export of energy and production of solar panels using the abundant silica found on the island.

Riaz Hamidullah also underscored the importance of sustainability, circularity and carbon neutrality. Laksiri Mendis outlined opportunities to develop structures and institutions, resources relating to the sea, while other speakers suggested that many opportunities could be found in emerging industries such as technology development, health-tech, fintech, clean-tech, edu-tech, cybersecurity and agri-business. 

Many panellists observed that consumption patterns in industries like tourism are changing with the pandemic, but will vary based on region. The vaccination drive was cited by multiple speakers as a core area for the future of Sri Lankan tourism, which is going to be essential in the ‘new normal’.

Conclusion

In this new age, missions have a key role to play in promoting tourism, exports and investments and are faced with both opportunities and challenges which can only be navigated by engaging competent people. The need is for an integrated structure that allows for cohesion in Sri Lanka’s economic diplomacy efforts, and for key personnel to be equipped with the training and the support to lead the effort.