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Wednesday, 6 November 2013 00:00 - - {{hitsCtrl.values.hits}}
Foreign Minister Prof. G.L. Peiris has stated in an interview that there has been some emphasis in attracting foreign investors through a new strategy of pursuing economic diplomacy by our overseas diplomatic corps. It is indeed welcome news if it has succeeded.
It is almost four years since the war was ended and there should be a mammoth increase in our economic activities. The results have not been as satisfactory as one would have expected. The Foreign Minister should be commended for initiating this new strategy which seems to have been articulated at the conference held in Bandarawela for Sri Lankan diplomats.
Holistic approach needed
Art and skill in negotiations play a major role in international trade. This is an area where further improvements can be had. There are a number of academic institutions dedicated to advancing studies in economic diplomacy and negotiations. This subject comes under international relations and Sri Lanka does have the training institutions dedicated for the subject. It is a question of having a holistic approach to the issues that beset the image of Sri Lanka. The country’s image is being tarnished by the pro-separatist lobby at every global event that concerns Sri Lanka.
Economic diplomacy should be the primary focus of our diplomats and some performance appraisal measures should be in place to check its effectiveness. It is also imperative to select the best individuals to run our diplomatic missions overseas. It should not be an area for rewards for those who have supported the government agenda whilst on duty. There is a popular perception that those who have favoured the government of the day would be sent overseas as ambassadors. This is a wrong signal given to senior public servants.
Are we fully equipped to face globalisation?
Globalisation has caused mammoth strides in the way in which trade and investments are promoted. It has augmented the importance of economic interdependence among nations. There is greater competition than ever before among nations for a bigger slice of the market. With the advent of communications technology, the economic competition has become even more rigorous compared to what it was a decade back.
Pradeep Mehta, Secretary-General CUTS International, says in his book ‘Economic Diplomacy – India’s Experience’ that it is “concerned with anticipating and influencing the outcomes of future economic policy regimes of other countries. This requires a need for better understanding of 
the working of market forces in different countries in the given dynamic global economic environment. The process of continuous engagement through economic diplomacy helps a country in advancing its economic interests and, equally importantly, those of its partners. A crucial pre-condition for the successful conduct of economic diplomacy is the existence of a critical pool of skilled personnel in the government, private sector and civil society to understand and negotiate trade, investment and other economic issues from the national development perspective after taking into account a country’s strengths, limitations, opportunities and threats.”
Economic diplomacy covers the entire gamut of governance and it is the use of all the economic tools of the state to achieve its economic objectives. Economic diplomacy covers imports, exports, FDI, environment, lending, securing development assistance from donors and signing FTAs with countries with economic benefits to Sri Lanka. It must also protect the interests of the country when it comes to events that have far-reaching economic consequences.
Sethusamudram Project: Where is the diplomatic response from Sri Lanka?
India is actively involved in advancing the Sethusamudram project. What has Sri Lanka done to dash this project? It will have a tremendous economic impact on the shipping trade. All ships plying to and from the eastern and western coast of India navigate around Sri Lanka and often ships call at Port of Trincomalee, Galle or Colombo for cargo, bunkering, repairs and other crew requirements. It is a thriving business for Sri Lankan shipping companies.
Here comes a case of economic diplomacy coupled with official diplomacy. The public interest litigants (PIL) and Hindu activists have filed cases with Supreme Court of India in an effort to scuttle the project. But the Archaeological Survey of India had stated that there is no scientific evidence to prove that an ancient bridge had been in existence in this area. Even the committee appointed by Prime Minister Manmohan Sigh also advised against the project.
What has Sri Lanka done to verify the claim that there is no scientific basis to the ancient bridge? This is case where Hindu sentiments and Indian public opinion could have been mobilised easily. Sri Lanka has not even promoted tourism under the ‘Ramayana Trail’ as vigorously as tourism industry would have cherished.
If Sri Lanka is indeed interested in protecting its economic interests, it should have made its presence felt in Delhi. Nothing concrete seems to have been done. Perhaps other priorities must have taken precedence at the time the project was mooted by Government of India.
Has the Government of Sri Lanka done an assessment of the economic loss as a result of this new shipping route? Ironically on the Indian side, the economic gains must have been simulated, otherwise the project would not have received the green light from the Government.
Where was the diplomatic protest over this project? Sri Lanka’s stance should have been on the historical facts, the massive environmental damage it would cause to natural marine habitation and also on the fact that when the tsunami struck, Kerala coast was spared due to these geographical conditions. Even the International Court of Justice (ICJ) would have been moved against this measure.
Where were the so-called religious-based parties in India at the time? Why did they not canvass support from Sri Lanka? The street protests were extremely marginal compared to Hindu majoritarian politics. BJP and some other allied parties had protested but it would be interesting to see how BJP would react to this project if it comes to power. Did Sri Lanka produce a report on the project? Do we still have time to voice our concerns?
Economic diplomacy and regaining GSP+ concessions
Now Foreign Minister Prof. G.L. Peiris, an Oxford educated legal luminary, has stated that his main objective in foreign policy is economic diplomacy. This means that the time is opportune to revive our relations with the European Union. The business lobby and Chambers of Commerce must come to the fore and lobby the Government to resurrect the full GSP+ concessions. Of course this would have political ramifications and borders on good governance practices.
There are many domestic issues that would surface if we are really interested in reviving the GSP+ concessions. It is the political will of the Government that counts. Our market share in the EU for apparel exports was taken over by Pakistan, India and Bangladesh. According to studies undertaken by the Institute of Policy Studies (IPS) we would feel the pinch from next year onwards.
If we increase our exports, we would redeem our ever-increasing debt burden. So the million dollar question is, are we serious about enhancing the image of Sri Lanka abroad? Are we really serious about improving the domestic political situation? Can we really meet the demands of the EU or the international community? Do we consider these as ‘foreign conspiracies’ as some ministers of the Government who are calling themselves ‘patriots’ harp on this nonsensical logic?
IPS Executive Director Dr. Saman Kelegama says: “The EU should recognise that democracy building can best come from within rather being imposed from outside, and should therefore become a supportive facilitator of democracy building and human rights in a non-intrusive manner, allowing South Asia to find its own answers that are consistent with the ethos of the region.”
The EU is a powerful organisation with political backing from powerful countries. They would of course resort to the carrot and stick approach as has been the policy of many powerful organisations. A small country like Sri Lanka cannot do much except toe the line and get things done in our favour. What we need now is the restoration of public confidence in the institutions that nurture democracy in Sri Lanka such as Judiciary, media, police and elections.
(This writer is a freelance journalist and a political lobbying and public affairs consultant. He is a member of the American Association of Political Consultants)
