‘SL-S’pore FTA to go ahead’ | Sunday Observer

‘SL-S’pore FTA to go ahead’

The Sri Lanka-Singapore Free Trade Agreement (SLSFTA) will go on as planned and there will be no looking back if the country is to be competitive and benefit from the rest of the world, State Minister of International Trade Sujeewa Senasinghe told the Sunday Observer.

He said, “If we let go the FTA with Singapore, Sri Lanka will lose access to a 4.5 billion market through which it could build trade with the South and South East Asian countries.”

“We cannot as a country hide inside a shell like a snail any longer when the world is moving fast with advanced technology. Look at how East Asian economies such as Singapore, Malaysia, Taiwan and South Korea have become economic giants in the region. All this is because they are open and ready to learn from the world,” the minister said.

He said a ‘close minded’ attitude has always been the case even from the time of former Presidents J.R. Jayewardene and Ranasinghe Premadasa who were criticised for liberalising the economy. It was the garment factory program of former President Premadasa that gave a boost to the economy through exports of garments.

“Our exports touched US$ 11 billion last year of which around $ 6 billion came from exports of garments. The export income from garments will increase to around $ 10 billion with the support of the GSP Plus concession bringing the total export income to around $ 16 billion soon,” Senasinghe said.

Export income crossed the $10 billion mark notching $ 11 billion last year. However, exports which had accounted for around 32 percent of the GDP fell to around 12 percent during the last decade due to the absence of a national export strategy and diversification of export products.

“Therefore, we can no longer depend and be comfortable with the export of tea, rubber and coconut and a few other products. The country must go beyond its traditional exports to manufacture and export electronic products, automobile parts, censors for cars, televisions and radios,” Senasinghe said.

Trade experts said if the country is to shift to manufacture of electronic and high demand products there has to be a blueprint or a methodology, machinery and the knowhow. The difference between Sri Lanka and first world countries is the presence of expertise in developed economies. To counter this Sri Lanka needs to be open to foreign direct investments from Asia, South East Asia, US and Europe.

“It is very unfortunate that we are not yet prepared to compete with other countries. This is because we do not produce quality products using advanced technology. We produce common items which all other countries do that have less demand. We should not fear and panic when a foreign company comes to the country. It not only brings new products but also new technology and this will create competition ,” the minister said.

Sri Lanka is in the process of entering into free trade agreements with many regional countries including Malaysia, Thailand, Taiwan and Indonesia.

‘The FTAs will help boost trade with countries that have a lot to offer us. The national export strategy and the national trade policy will support trade development with protective measures to safeguard local industries,’ the minister said.

However, professionals have raised the alarm that the SLSFTA contains many loopholes that are detrimental to the country. Professionals from various organisations have been voicing concerns that the FTA with Singapore lacks transparency and input from experts whose professions could be in jeopardy if proper protective measures are not in place.

A spokesman for the United Professionals’ Movement said experts representing the movement are in no way against bilateral free trade agreements but they need to be done in consultation with the stakeholders of the economy to ensure the country is benefited.

Sri Lanka and Singapore signed an FTA early this year aimed at deepening economic ties and facilitating greater trade flows between the two countries. Following the deal both countries will gain access to the markets of each other across a multitude of sectors. 

Comments