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Tuesday, 15 July 2014 00:01 - - {{hitsCtrl.values.hits}}
By Shabiya Ali Ahlam
The Netherlands yesterday expressed optimism about Sri Lanka’s economic progress saying the post-war prospering country would see more support for trade than aid.
“In 2005 the Netherlands decide to phase out the bilateral development corporation and the decision was informed by our understanding that our limited development should be focused on the poorest of the poor.
The good news for Sri Lanka is that you are not one of them,” visiting Dutch Vice-Minister for Foreign Trade Simon J.H. Smits told journalists in Colombo yesterday.
However he said that the new policy didn’t mean the Netherlands didn’t have other funds available. “We have substantial funds available from which Sri Lanka can profit,” said Smits, who is leading a top Netherlands trade delegation to Sri Lanka.
“The potential of Sri Lanka, this is basically the policy shift that we made 10 years ago , we think is best unlocked by trade relations, investment exchange and knowledge. This is why we are shifting in short from aid to trade and that is our reason for being here today,” the Dutch Vice Minister emphasised.
Commending Sri Lanka on its post-war economic progress, Smits said: “When I look at the growth figures, the inflation, and the macroeconomic indicators, I am getting a bit jealous. I think some of the indicators could probably make you join the Eurozone. You are doing quite a lot better than many of our colleagues, including ourselves, in the Eurozone, so I am pretty optimistic. I think things are really looking up for Sri Lanka.”
The delegation is on a three-day visit and comprises leading Dutch companies Boskalis, Vitens Evidesm, Enraf Nonius, Van Der Knaaop, Eijkelkamp and Rabobank.
“Size doesn’t matter. We have five companies that may not seem as much but they are top of the bill when they come to their expert field,” Smits added.
The delegation will be in Sri Lanka until 17 July for dual purposes, of which one is to gain a firsthand impression on the prevailing opportunities in the nation. The other is to offer a fact finding and trade mission to Van Der Knaap, which won the Ambassador’s Award for the ‘Most Active and Innovate Company’ at the Netherlands Ambassador Conference 2014.
The team is the first high-level delegation to come to Sri Lanka since the 2005 post-tsunami visit the Netherlands made with its Foreign Minister.
“We are actively looking for new trading partners around the globe and we want to do this on an even-handed partnership basis. In other words, we are and have been of the firm belief that trade is a two-way street and that it is definitely a win-win. We want to explore new opportunities. We also want to diversify later on. For now we will be focusing on water, agriculture, life sciences and health,” said Smits.
To gain insights into the health and water sectors, the delegation will be meeting with the relevant authorities for a round table discussion where opportunities, challenges and way forward will be comprehensively deliberated.
In addition the team is scheduled to meet Minister of Economic Development Basil Rajapaksa, Minister of Health Maithripala Sirisena, Minister of Water Supply and Drainage Dinesh Gunawardena, Treasury Security Dr. P.B. Jayasundera and CEOs of Dutch-linked companies. The schedule also includes site visits to the Colombo Port, Colombo National Hospital and Ambatale Water Treatment Plant, Kelaniya.
Smits emphasised that the mission is “only a start” and is a first familiarisation with the potential opportunities and challenges of the nation.
Trade relations between Sri Lanka and the Netherlands is at an annual average of $ 200 million and has been growing at 10% YOY, according to the Vice Minister.
Having a population of 17 million, the Netherlands is amongst the 20 largest economies of the world and is recognised as the fifth largest exporter in the world.
Euro 700 m Dutch fund open for SL
Sri Lanka entities can have access to a Euro 700 million fund set up by the Netherlands as part of expanding their business.
The Dutch Good Growth Fund (DGGF) that commenced on 1 July is open for Sri Lanka and other countries falling under the definition of emerging and developing nations.
With the total fund value being Euro 700 million, the disbursement for 2014 has been set at Euro 100 million according to visiting Dutch Vice Minister for Foreign Trade Simon J.H. Smits, who is in the country with a five-member high-level delegation.
“This fund supports Dutch SMEs and entrepreneurs in emerging markets and developing countries by offering a source of finance of development relating activities. It can also be used by entrepreneurs in Sri Lanka to set up a business or a joint venture,” explained Smits during a press conference held to officially kick off the three-day mission.
“It (DGGF) consists of three separate tracks, and the third track concerns export credit insurance and finance for development related activities for Dutch SMEs. I am confident that the fund will be utilised both by Sri Lankan and Dutch entrepreneurs,” he added.
Run by the Netherlands Enterprise Agency, the DGGF supplements private investments through guarantees and direct financing, such as loans and participations without a profit motive. The DGGF will support existing and new investment funds that provide financing to local SMEs and financial institutions.
Touching on how Sri Lanka can do better in doing business with the Netherlands, Smits advised local business not to look at trading as a part of the supply side, instead look at what the trading partner really requires.
“Put yourself in the shoes of the partner in order to identify what is needed instead of reasoning with what you can offer. Don’t come to the country and say ‘here it is’ and go in for the quick buck. Dutch companies don’t go in for the quick win. They are here to stay, so you have to show commitment, mutual respect and be in it for a long haul. That is one of the defining factors for success,” asserted Smits.
