Five-year deadline for Asian economies to become competitive: Amunugama

• Says corruption, red tape, and mismanagement need to be stamped out

• Praises Sri Lanka’s latest Ease of Doing Business rankings

By Uditha Jayasinghe

In the face of growing global financial difficulties, a Senior Minister yesterday warned that unless Asia Pacific countries including Sri Lanka did not minimise an estimated US$ 350 billion in trade wastage and red tape within the next five years, the region would be economically challenged.

Senior Minister for International Monetary Cooperation Dr. Sarath Amunugama delivering his address as the Chief Guest at the Asia Pacific Trade Facilitation Forum 2012, which brought together representatives of around 30 countries, urged them to “cut slack” and become “lean and mean” if they wish to remain in contention within an increasingly-challenging global atmosphere.

Pointing out that the traditional markets of US and Europe are no longer able to spearhead world consumption, Dr. Amunugama noted that this “unique juncture in history” called for the revamping of world trade patterns.

In his view this meant that emerging countries had to stamp out mismanagement, corruption, sluggish bureaucracy, and lack of coordination if they wanted to remain competitive.

“The upshot of global economic changes is that Asian countries have to rethink their trade strategies. They cannot just play dead. They need to cut slack and become more efficient if they wish to continue growing,” he said.

The Senior Minister added that efficiency goals must be reached within the next five years if they are to have a realistic chance of maintaining Asian growth both regionally and globally. He insisted that intraregional growth alone would be insufficient and that Asian countries need to evolve to continue growing in markets of developed countries as well.

“Asian countries need intraregional trade as well as global trade to continue their growth trajectory. Here in Sri Lanka we have managed this. We have managed to climb the World Bank Ease of Doing Business rankings and have been progressing each year since 2009. It is not easy but it can be done.”

Referring to the speech made by United Nations Economic and Social Commission for Asia and Pacific (ESCAP) Trade and Investment Division Director Ravi Ratnayake, where he mentioned that red tape cost the region a whopping US$ 350 billion a year, Dr. Amunugama stressed that it showed the depth of the challenge.

Implementing trade facilitation reforms for regional connectivity, effective consultation between public and private sectors, and developing systems for information exchange between countries were also highlighted by Ratnayake.

“The somewhat shocking reality is that Asia Pacific is still better connected to Europe and America than with itself. Our latest research shows that trade costs of the region with North America and European Union are 20% less than those with itself. With cumbersome border procedures for many countries, it is easier and cheaper to trade with far away developed countries rather than the ones next door.”

Industry and Commerce Minister Rishad Bathiudeen and Asian Development Bank (ADB) Country Director Rita O. Sullivan also expressed their support for regional trade integration during the inauguration of the summit.