Economic relations between Sri Lanka and the US will kick into high gear with both sides detailing plans to implement a five-year Joint Action Plan to increase trade and investment to be worked out over the next few weeks.
In a Joint Statement released following the US-Sri Lanka Trade and Investment Framework (TIFA) Inter-Sessional Meeting held at the start of this month both countries have decided to focus on tariff preference arrangements; plan for a US-Sri Lanka Business Opportunities Conference; support youth entrepreneurs; enhance Sri Lankan capacity to export food items to the United States; and further mechanisms to support Sri Lanka’s goal to serve as a regional services hub.
“We also discussed removing obstacles to trade and investment, establishing new modalities of investment in vocational and higher education, and collaborations on strengthening worker rights and promoting ethical and environmentally sustainable manufacturing practices. The two sides will work to finalise the implementation plan text in the coming weeks,” the joint statement released to media on Friday said.
At the conclusion of the 28 April TIFA Council meeting, a US-Sri Lanka Joint Action Plan to Increase External Trade and Investment was adopted. Both sides affirmed their belief that the bilateral trade and investment relationship has great potential that can be realised through the adoption of enabling measures jointly incorporated in the plan.
“The Joint Action Plan aims at reaching its goals over a span of five years. At the April 28 meeting both sides also committed to deepening their engagement over the coming months in order to develop a detailed implementation plan for the Action Plan based on specific proposals submitted by Sri Lanka on improving export competiveness, technical and financial assistance, improve the role of women in trade, develop new markets and regional services, promote greater business interaction, assistance for capacity building of SME sector, etc. This Action Plan would be implemented through a five-year period during which an Action Plan for the first year is already being finalised.”
International Trade and Development Strategies Minister Malik Samarawickrama at the opening session of the US-Sri Lanka Trade and Investment Framework (TIFA) in Colombo called on the US Government to assist its counterpart to meet public expectations on economic growth, hinting the Sri Lankan Government would face growing unpopularity otherwise.
“I am of the view that we are somewhat falling behind meeting the expectations of the vast majority of our people, in improving their material wellbeing. They are also interested in a sustainable economic dividend. In fact, they are becoming impatient for it,” Samarawickrama said pointing out Sri Lanka’s growing middle class was demanding better employment opportunities with higher salaries.
Minister Samarawickrama highlighted the reforms that the Government of Sri Lanka is undertaking to improve the ease of doing business, facilitate greater exports, increase regional integration, attract foreign direct investment and to support reconciliation. He emphasised Sri Lanka’s interest in the establishment of preferential trade programs such as Qualifying Industrial Zone (QIZ), especially for the economic improvement of the Northern and Uva provinces in the country.
Stronger trade and investment would be a catalyst to this end as the US remains the country’s single largest export destination accounting for 23% of total goods and services sent out from Sri Lanka. In 2015, total bilateral trade between the two countries stood at $ 3.3 billion. US-Sri Lanka bilateral trade jumped 33% in the five-year period from 2011. The Minister also noted a US company was in discussions to start bunkering at the Hambantota port, though he declined to name the entity