Dr. Harsha De Silva on new foreign policy initiatives or ‘economic diplomacy’

Deputy Minister of Foreign Affairs Dr. Harsha de Silva

Addressing the members of the United Professionals Group on Thursday 26 November at Sri Kotha, Deputy Minister of Foreign Affairs Dr. Harsha de Silva said: “The narrow and petty-minded foreign policy pursued during the last decade saw an unhealthy downward trend that led to a decline of the country’s economy. An oft-repeated slogan was that the UNP was conspiring with US and the West to get rid of the then President who won the war for the country and Western interests were trying to engulf the country. Sri Lanka was perceived as the black sheep of the global community as a result of this short-sighted foreign policy. The current dynamic market based trading economy, first introduced by late President J.R. Jayawardena and continued to be followed, is dismally misaligned with the foreign policy that was pursued in the recent past. The foreign policy did not support the economic policy and as a result, it led to an unsustainable equilibrium in economic and foreign policy.”

He went on to say that due to this high-handed attitude and the failure to address the issues properly, the country lost the qualification to be a beneficiary of the GSP Plus facility granted by the US and the EU. The local industry, particularly the garment industry which provided employment to thousands, virtually collapsed. This affected mainly the small and medium level garment factories but those large companies that had contracts for branded products were able to survive. The employment opportunities and livelihood available to the people therefore suffered.

“Sri Lanka was blind to what’s happening around the world and because of the paranoia that Sri Lanka should not engage with certain countries, our relations with many economically influential countries have soured so much and as a result, the bilateral trade agreements, especially with India did not see the light of day. We were precluded from negotiating and including terms more favourable. Export income which stood around 35% of GDP in 2004 declined to 14% last year. Instead of exporting goods and services of Sri Lanka, it was compelled to export ‘human beings ’or practice ‘neo slavery’ to earn dearly required foreign exchange. The poor workers so employed were called by catchy phrases like ‘Rata Viruwo,’ but there were hardly any gains for them.”

Dr. Harsha added that the new Government, with the vision and wisdom of its leaders, President Sirisena and Prime Minister Wickremesinghe, had to think differently and take a fresh look at everything. We had to formulate and pursue a foreign policy envisaging friendship with all countries, which will ultimately benefit Sri Lanka in the long run. That is to say we needed to provide services to our customer, meaning the world, and then reap the economic benefits. Kudos to Foreign Minister Mangala Samaraweera who painstakingly rebuilt our relations with many countries who were offended by the previous regime. The Government’s new thinking is that we will not send people out but we will export our goods and services. Sri Lanka will invite investments that will help to produce exportable goods of high quality. We will try and enter the US market, the largest in the world on a higher scale.”

He further said that the Prime Minister’s vision is that Sri Lanka should be a trading country and its relations with the outside world is one of ‘economic diplomacy,’ which is a new paradigm. Sri Lanka cannot depend on the global trade envisaged by the World Trade Organization or outcomes of the Doha Round, which was not successful but engage with the appropriate regional economic groupings such as Trans Pacific Partnership (TPP accounts for nearly 40 % of world trade) and other mutually-beneficial bilateral agreements. Viet Nam, a country which had its exports around $ 2 billion in 1990 almost on par with Sri Lanka had grown to $ 120 billion in 2014 compared to Sri Lanka’s $ 11 billion. Viet Nam will soon join the TPP. 

The new trends in foreign relations coupled with internal developments in the fields of democracy, good governance and human rights had earned plaudits for Sri Lanka so much so that the country was invited to participate at the Open Government Partnership conference in Mexico where 66 countries participated. He had the privilege to participate along with Minister of Justice Wijeyadasa Rajapakshe at this conference. Samantha Power, US Cabinet Member of President Obama’s Government and US Representative at the UN, in her address spoke eloquently about Sri Lanka’s new developments in such glowing terms that our country earned accolades from many representatives present. 

So considering all these aspects, the new policy initiative is ‘economic diplomacy’ in foreign relations. Sri Lanka’s relations with other countries will be focused on economic relations along with other considerations like cultural ties being given due cognisance. The US will soon engage with Sri Lanka on further economic participation. 

In answer to a question from the audience, Dr. Harsha explained that Sri Lanka maintains her good relations with China as before and would like to see more investments rather than loans from that country. The Prime Minister has himself commented that China is as important to us as any other country in our relations. 

On another question, Dr. Harsha explained that GSP Plus facility was not renewed because of anybody’s fault but due to our failure to enact certain legislative requirements that were agreed. However, these aspects are pursued with vigour and an enormous amount of documentation is needed to be completed. Germany is very keenly supporting our request to restore the GSP Plus facility which is expected to be finalised next year. USAID is also reconsidering the extension of its facilities here. In conclusion, he reminded the participants of the famous quote from President Clinton’s campaign: “It’s the economy, stupid!” which drew laughter from the audience.

Earlier, UPG President Kanishka Jayasinghe whilst welcoming Dr. Harsha de Silva stated: “This meeting was somewhat like the OPA’s ‘meet the people’ discussions at which Maithripala Sirisena himself had participated then as a minister. Today’s participants include members of the National Association of Professionals in Engineering, Technology and Science (NAPETS) and the Young Professionals Organization (YPO).”

He further stated that since Dr. Harsha De Silva was a friend of all three organisations and since he himself declined the formal introduction, he was inviting Dr. De Silva to address the gathering. Dr. Mohan Abeyratne proposed the vote of thanks.