Sri Lanka’s Strategic Economic Growth Plan Focuses on Trade Expansion and Market Access
In a bid to rejuvenate its domestic economy, the Sri Lankan government has unveiled a multifaceted growth strategy that emphasizes two pivotal elements: expanding supply capacity and broadening market access. This comprehensive approach is geared towards driving economic recovery and growth in the nation.
Key aspects of this economic strategy include strengthening ties with traditional export destinations, such as the USA and the EU/UK, and deepening integration with regions in South Asia, South East Asia, and East Asia. Bilateral trade agreements play a crucial role in this strategy, with existing agreements in place with South Asian partners like India and Pakistan. Furthermore, Sri Lanka benefits from regional trade pacts, such as the South Asian Free Trade Area (SAFTA) and the SAARC Preferential Trading Arrangement (SAPTA).
Sri Lanka is actively involved in Preferential Trade Agreement (PTA) negotiations with Bangladesh, focusing on trade in goods. These negotiations, initiated in June 2021, are progressing through multiple rounds of discussions and aim to boost bilateral trade.
The country is also set to enter the 12th round of negotiations for the Economic and Technology Cooperation Agreement (ETCA) with India, a comprehensive agreement with a broader scope than the current India Sri Lanka Free Trade Agreement (ISLFTA).
Sri Lanka is expanding its engagement with ASEAN countries through Free Trade Agreements. The Sri Lanka Singapore Free Trade Agreement (SLSFTA) with Singapore is already in effect, and negotiations with other ASEAN nations like Thailand and Indonesia are underway.
In addition, discussions with China to establish a Free Trade Agreement have seen six rounds of negotiations, with the goal of gaining market access for Sri Lankan products in China.
Sri Lanka is also progressing towards joining the Regional Comprehensive Economic Partnership (RCEP) Agreement, the world’s largest Free Trade Agreement, highlighting its commitment to global economic integration.
These trade agreement negotiations are overseen by the National Trade Negotiation Committee (NTNC), appointed by the Cabinet. The NTNC, led by the Chief Negotiator of the Office of International Trade, comprises senior-level officers from various government departments and institutions, supported by subcommittees representing relevant ministries and departments.
These comprehensive trade initiatives are aligned with Sri Lanka’s vision of becoming a developed economy by 2048, in line with the government’s overarching goals for economic growth and prosperity.