UK and the Commonwealth: Swire calls for “golden thread of development” approach
Thursday, 14 November 2013 00:46
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By Cheranka Mendis
Representing a third of the world’s population and over one billion citizens under the age of 25, the Commonwealth comprises some of the world’s fastest growing economies, exporting over four trillion pounds of goods and services a year.
Speaking at a networking lunch hosted by the Central Bank of Sri Lanka, UK Minister of State for Foreign and Commonwealth Office Hugo Swire noted that as far as the UK is concerned, the importance of Commonwealth is reflected in the fact that the UK has strengthened commercial capacity in its high commissions in Commonwealth countries. UK trade investment helps British companies of all sizes to do business across the Commonwealth, providing the opportunity to expand the already-deep business links.
Solid platform for trade and investment
The Commonwealth provides members a solid platform for trade and investment. “Our share of language, similar legal systems, our principles of democracy and rule of law, and good governance sets the parameters for beneficial partnerships,” Swire said.
“We believe that sustainable prosperity and development is not possible without good governance, rule of law, property rights, effective public services, strong civil institutions, free and fair trade and open markets.”
The applies not only to countries rising out of poverty, but also to those like Sri Lanka aspiring to make the transition to high growth and high per capita welcome, and also to established economies like the UK where it has shaken up the public sector and put a renewed emphasis on its growth.
Golden thread of development
Swire noted that the approach in the future for countries must have at its core is what UK Prime Minister David Cameron called the “golden thread of development”.
“As he (Cameron) said, we should not ask whether countries are getting richer, but whether they are getting freer, fairer and becoming open,” he reflected. “The Commonwealth is perfectly placed to support development in this regard.”
Good governance like good corporate behaviour helps create jobs, contributes to market sustainability, reassures shared purposes, attracts investors, improves reputation and has the potential to generate long term growth.
Improvements for Lankan economy
In Sri Lanka, corporate governance and the general business environment have been improving since the end of the conflict, he acknowledged, however things are not perfect and there is room for improvement. This means increased transparency, simpler regulation and faster procedures, good governance and respect for the law. “These are the ‘golden thread’ factors that can convince British companies to continue to invest here.”
UK companies have a significant footprint in Sri Lanka with over 100 UK companies operating here, including HSBC, SCB, GSK, Unilever, Rolls Royce, etc. The UK is Sri Lanka’s second largest trading partner in terms of volume and is a top five investor. Earlier this year, the largest-ever bilateral trade contract was signed with Airbus and Rolls Royce by SriLankan Airlines for a new fleet of aircrafts and engines.
What the UK needs to do
Over the coming years, if the ‘golden thread’ factors develop positively, Swire expects a number of UK companies to increase further and expand into other sectors where the UK is home to world-class expertise.
“In the UK we need to double our efforts to get SMEs to up their game and start exporting more and rediscover the entrepreneurial spirit.”
Where they can offer services second to none is in the financial services sector.
“The UK is the leading exporter of financial and professional services across the world and thriving and expanding for Islamic finance. We have a huge amount to offer the Commonwealth.”
