Saturday Sep 21, 2024
Saturday Sep 21, 2024
Thursday, 13 November 2014 00:00 - - {{hitsCtrl.values.hits}}
I am confident that today’s meeting would be a historic event for both Sri Lanka and Kenya as it is expected to pave the way for enhanced trade, economic and commercial relations. The visit of President Mahinda Rajapaksa to Kenya in 2013 and obtaining the accreditation status in the African Union (AU) as a non-African State laid the foundation for further strengthening of Sri Lanka’s relations with the African region including Kenya.
Your Excellency, as you are aware, diplomatic relations between Sri Lanka and Kenya were established in 1970, and since then, both the countries have maintained friendly and cordial bilateral relations in all areas, in particular, economic, trade, cultural and political spheres. Most importantly, the two countries have consistently shared common views and tirelessly worked towards a common goal on matters of mutual interest to the two nations and in particular on global issues at the multilateral forums such as the NAM, G-15, G-77 and the Commonwealth.
The Sri Lankan Government established diplomatic relations with 15 African States in 2012. As of today, Sri Lanka has established diplomatic relations with 41 African countries with six resident missions. We understand that Kenya plays a vital role as a member of the Common Market for East and Southern Africa (COMESA). Similarly, Sri Lanka plays an active role in South Asia Free Trade Agreement (SAFTA). Both these regional bodies will find greater opportunities to expand market and to work towards common objectives.
Trade and economic cooperation
Sri Lanka has been the pioneer in South Asia to introduce liberal and market-oriented economic policies as far back as in 1977. The country’s import regime has been liberalised; today 48% of total tariff lines are at zero import duty, which is higher than that of the EU: Export control measures were minimised and foreign exchange regulations have been relaxed, thereby creating a business-friendly environment.
These initiatives and the consistency in our economic policies, under the able leadership of President Mahinda Rajapaksa with his vision for the future under the ‘Mahinda Chinthana’ have brought Sri Lanka much closer with global partners. In particular, we look forward to closer trade and economic cooperation with the countries in Africa.
The end to the prolonged internal conflict in 2009 and the restoration of peace and normalcy in Sri Lanka has created a greater optimism about the achievement of the economic prosperity, providing a strong basis for long-term sustainable development supported by appropriate policies. The strategy is seen with the commencement of the infrastructure development in the fields of ports, roads and highways, power, public utilities, and aviation.
Important milestones
In the post-conflict economy, Sri Lanka recorded many important milestones. The per capita income is reaching $ 4,000 in a relatively short period, thereby elevating the country to an ‘Emerging Market Economy’ status; the economy grew to a robust $ 67 billion of GDP in 2013, from about $ 24 billion in 2004; the Services sector was the major contributor to the economy, accounting for 51.3% of the total GDP in 2013 whereas industry and agricultural sectors contributed 41.5% and 7.2% of the total GDP respectively.
The latest IMF assessment has given a glowing tribute to Sri Lanka’s economic performance. Its 29 July statement says: “Sri Lanka’s economic growth has been one of the fastest among Asia’s developing economies in recent years.”
Strategic location
Sri Lanka’s strategic location as a connecting point of sea and air transport between the East and West has been instrumental in expanding trade with the world.
The Free Trade Agreements that Sri Lanka entered into with India (2000) and with Pakistan (2005) have already become the gateways for the manufacturers and investors in Sri Lanka in accessing the sub-regional market with over 1.6 billion people.
Tourism
Skilled labour force, business infrastructure, common law based legal system, highly modernised sea port operations, recreational facilities and living standards have provided many opportunities for foreign investments. Apart from the above, one of the promising sectors for investment in Sri Lanka is tourism. We expect to cater to 2.5 million tourist s by 2016.
The strategic objectives of the country aims at a GDP growth of 8.5%, 2.5 million tourist arrivals, increasing private sector investment to 24% of the GDP and an ICT literacy rate up to 75% by 2016. These are aligned with our major objective of becoming one of the leading and most attractive business hubs in Asia.
Bilateral trade
In relation to bilateral trade between our two countries, we are not complacent with the present level of the magnitude of bilateral trade and other economic activities between the countries which I surmise are much below the true potential. The value of the total trade in 2013 was $ 14 m. This is not a significant level that both countries could be satisfied with. We should consciously strive to realise true potential.
I strongly believe that this forum could open new vistas of cooperation for mutual benefit and pave the way for intensification of efforts to consolidate the existing cordial cooperation. However, it’s my pleasure to place on record that the Sri Lankan exports have gradually entering into the Kenyan market as evidenced by the increase of total Sri Lankan exports to $ 11 m in 2013, which stood at only $ 4 m in 2006.
We could consider complementing our trade promotion efforts by concluding the Agreements on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on income and investment promotion and protection. We could think of sharing technology in the area of product improvement and applying best practices such as green production.
I have been also informed that both sides are in the process of concluding the proposed MoU on Cooperation in the field of Agriculture which would enhance the opportunities to both countries to establish a comprehensive mechanism to assist in each other’s agricultural sectors.
I trust that the deliberations of this forum would elevate our bilateral trade relations to new heights and be a launching pad for greater cooperation for mutual benefits.
Finally, I’d like to wish the joint trade committee discussions all success
Thank you.
