News360, Sri Lanka
Sri Lanka business chamber wants CEPA and more trade agreements
10 July 2013
Sri Lanka’s main business Chamber urges the government to fast track the signing of the Comprehensive Partnership Agreement with India and also sign more trade deals to avoid over-dependance on one country for exports.
“We urge the Sri Lankan government to fast track the Comprehensive Economic Partnership Agreement with India, subject of course, to the details to be negotiated”, said Suresh Shah, the Chairman of the Ceylon Chamber of Commerce.
Shah was speaking at the inaugural session of the Sri Lanka Economic Summit 2013, which commenced last evening in Colombo.
The Chamber Head made this suggestion, as he emphasized the importance of Sri Lanka becoming an export-centric nation, as he believes the country cannot sustain the economic growth trading within itself.
“Building a strong, sustainable, export centric economy will keep our trade balances & hence balance of payments, under control”.
“Diversifying our basket of exports into value added goods & services & broadening our export markets – particularly into Asia – must form a central part of the strategy”, Shah told the gathering.
He also says Sri Lanka needs to increase Foreign Direct Investments to reach approximately 35% of the GDP, for growth to reach 8%+.
“As of now, we have a shortfall of approx. 5% of GDP – or USD 3 bn per annum – which must be sourced from overseas. In terms of global FDI flows this is not a large sum but certainly a quantum leap by Sri Lankan standards”, Shah points out.
According to him, the size of the Sri Lankan market & the less than complimentary press the country receives in investor countries is impacting the Island’s ability to attract enough FDI’s.
The Chairman says it is important for the government to prioritize expenditure by means of reforming the loss making state entities, which the government is spending large sums of money to sustain those entities.
“Stronger reforms are necessary to address the SOE’s; at the least, their management must be professionalized. At best, they must be privatized”, added Shah.
The Chamber head points out that being an emerging economy, Sri Lanka must increase investments in essentials such as education, health & infrastructure.