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By Chamitha Kuruppu
Q: Why did you visit Sri Lanka?
A: About a year ago we established EUBASL. The reason for launching EUBASL was to act as a bridge between the European Union (EU) and Sri Lankan businesses. After having formally launched the organisation last year this year we are starting to roll out the program of activities.
There are two reasons for being here in Sri Lanka. I am here to meet the EU chamber. The key focus of this visit is to organise a program of activities of the information technology (IT) industry in Sri Lanka to come to Europe in May. We have been talking to some of the Small and Medium Enterprise (SME) businesses that are looking to develop relations in Europe. Sri Lanka has a very dynamic, very successful IT industry. We are working with the chamber identifying key areas. We believe there is potential for a much deeper relationship for businesses.
The other target will be to develop the tourism industry. The tourism industry has already expanded after the end of the conflict. But I believe at the commercial level there is lot of potential.
We will be meeting with the Governor of the Central Bank of Sri Lanka. I think it is very interesting the way the Sri Lankan economy has developed since the end of the war. It is impressive to see the developments that are taking place in this country. The report that was published in January in relation to GDP, keeping inflation under control and reducing national debt was impressive.
The EU financial sector collapsed in 2008. We brought in a lot of new legislations to stabilise the financial sector. We will educate the Governor about such changes. We will also meet the Deputy Minister for investment to discuss EU-Sri Lanka relations. It is very much a business-focused initiative.
Irrespective of the fact the conflict only ended few years ago, the economy in Sri Lanka is really dynamic and the business community is vibrant. Europe should be looking for stronger partnerships with Sri Lanka. We want to help to get this message across the Europe.
The Europe tour scheduled in May includes meetings and visits to the Brussels where we will have more programs lined up to promote the IT industry. A visit to London is also scheduled where the delegates will get an opportunity to meet a wide range of businessmen.
The business council has already organised a visit for the Deputy Industrial Minister to visit Brussels and also to London a several weeks ago. We want to follow up on these visits to see what further initiatives need to be taken.
We are also meeting the EU Ambassador for Sri Lanka. He is relatively new, therefore we need to discuss the business ties between EU and Sri Lanka with him. All the programs that we are hoping to initiate will be concrete ones.
Q: Internationally, Sri Lanka is in a crucial position with allegations on rights abuse and war crimes. A third UN resolution on Sri Lanka was adopted in Geneva last month. Do you believe this is the correct time to promote business between European Union and Sri Lanka?
A: This is the ideal time. Our program has not been determined by political factors. I know there has been a resolution against Sri Lanka by the UN Human Rights Council. I was the leader of the British Labour Party and I was a member of the EU Parliament. As a former politician what I understand is that what ensures stability in any country after there has been any conflict is economic development.
Enormous credit should go to the present Government and to the business community because Sri Lanka has high growth rates, there is increase in the GDP in the last eight years, the budget deficit is falling, investments are increasing; the economy is booming. I am a businessman more than a politician; I think this is the perfect time. Europe is trying to emerge from the recession. Sri Lanka has very dynamic growth rates. This is the time to see how Sri Lanka and Europe business can work more closely together.
As for the political situation my personal view is that there has been an enormous progress since the end of the war. In Britain, we’ve got a peace process going on in Northern Islands. These things take a long time. If there is anyone who think these matters can be resolved overnight; they just don’t understand the political dynamics.
"Enormous credit should go to the present Government and to the business community because Sri Lanka has high growth rates, there is increase in the GDP in the last eight years, the budget deficit is falling, investments are increasing; the economy is booming. I am a businessman more than a politician; I think this is the perfect time. Europe is trying to emerge from the recession. Sri Lanka has very dynamic growth rates. This is the time to see how Sri Lanka and Europe business can work more closely together
As the EU’s economy returns to growth, the potential for exports to Sri Lanka is substantial. It is proven fact that obstacles to do business here in Sri Lanka are very low. One of the things we will be explaining to the European business is to look at Sri Lanka as a new market. This is also going to provide new opportunity for Sri Lanka exports to the European Union. We should never forget about partnerships. This is beyond doing business in traditional ways. It is about creating new partnerships
I am great believer in open markets. I think if there is free trade globally the world economy would be much quicker. One of the big problems between many countries is that there are too many trade barriers. India is the best example. It is much easier to do business with Sri Lanka. It is one of the reasons we tell Europeans. Sri Lanka is a beautiful country with educated people and mostly importantly trade barriers are relatively low. You should not focus only on the EU, but you should not also forget that there are half a billion people in the EU with a lot of spending power. It is a big market
I think sanctions would be a catastrophic mistake by any international organisation. In the European Parliament there are over 40 members who support Sri Lanka and the number is growing. We will educate the EU Chamber as well as the minister about this progress. Sri Lanka can’t be the world’s best kept secret. Unless politicians especially in places like the European Parliament know the progress that has been made here, they will believe the information given by people who are hostile to Sri Lanka. Sri Lanka needs to alert the people about the progress you have made. It is very important that people who are in the positions of influence like members of parliament not only in Europe but in other places too fully understand the situation
We have got enough conflicts around the world. Look at Egypt, Syria and Libya, there are quite a lot of conflicts. Yet here in Sri Lanka you have been able to end a long conflict, stabilise peace and achieve economic growth. I don’t think anyone should disable that. If there are allegations, then they have to be properly investigated but that does not mean Sri Lanka should be destabilised by external forces"
Q: How much is the trade between EU and Sri Lanka at present?
A: The EU is Sri Lanka’s most significant trading partner. I think 36% of Sri Lanka’s trade is with EU. But I strongly believe that there is greater potential to develop that. According to statistics in 2012, EU imports from Sri Lanka were 2.5 billion Euros. EU exports to Sri Lanka were 1.3 million Euros. Obviously these figures were at a time when the Europe economy was very depressing. Even Sri Lanka’s growth rate since 2012 has increased and by now it is a very substantial growth rate.
It is a very dynamic relationship with the two entities. As the EU’s economy returns to growth, the potential for exports to Sri Lanka is substantial. It is proven fact that obstacles to do business here in Sri Lanka are very low. One of the things we will be explaining to the European business is to look at Sri Lanka as a new market. This is also going to provide new opportunity for Sri Lanka exports to the European Union.
We should never forget about partnerships. This is beyond doing business in traditional ways. It is about creating new partnerships. Especially in the IT industry we can do wonders. Of course the figures and numbers will not indicate such partnerships.
Q: Will you be providing financial assistance?
A: This is completely a business initiative. We will help and guide to broaden businesses. But those who want to take part in these delegations have to be self-financed.
Q: What are the areas Sri Lanka needs to develop?
A: Traditionally Sri Lanka has a strong textile industry. You should continue with that. The Sri Lankan textile market is about more value added products which go for a lot of high street names in Europe and United States. But you need to focus on industries like IT. That is vital. We will be visiting Orion Technology Park during the visit. This will help to get a feel for what sort of business we deal with in Sri Lanka. I love the technology sector because it is about working with a wide range of people, whether it’s people work in entertainment, computer games or the automobile sector.
The health sector should also be taken seriously. Agriculture and food also has potential. Tourism seems to be booming. When I saw the tourist arrival figures during the last five years I felt marvellous. Since the end of the conflict, the peace dividend is substantial.
However, everyone I met Europe and many others I met after I came to Sri Lanka say that the way to ensure sustainability in Sri Lanka is to make sure there are good quality jobs. I think that is sensible.
Q: What are your views about Sri Lanka exploring new trading opportunities and not depending on traditional Western markets?
A: Sri Lanka is a member of the ASEAN group. Interestingly I think a lot of things that are implemented economically in Sri Lanka are initiatives tried in the ASEAN countries. The Central Bank particularly in the banking sector is looking at consolidating financial institutions in Sri Lanka to make sure that the rules and regulations meet the high standards of G20.
Australia always looked to the United Kingdom and to Europe for trade relationships, but they realised that geographically its relationships should be with Asia. It now has strong relationships with countries like Japan and Indonesia. I feel it is natural for Sri Lanka to look into where the growth is. But I do think you got to be very careful, you keep a diverse economy. You should not put all your eggs in one basket.
Whether it is Europe, India or China, you need to diverse economies because you will never know what will happen in future. If there is a threat of external shock in a particular country and if all of your market is designed or directed to that country, then of course you lose your market share. Therefore, it is very important to have a strategy which makes sure that the trading relations are as diverse as possible.
I am great believer in open markets. I think if there is free trade globally the world economy would be much quicker. One of the big problems between many countries is that there are too many trade barriers. India is the best example. It is much easier to do business with Sri Lanka. It is one of the reasons we tell Europeans. Sri Lanka is a beautiful country with educated people and mostly importantly trade barriers are relatively low. You should not focus only on the EU, but you should not also forget that there are half a billion people in the EU with a lot of spending power. It is a big market.
Q: With the growing international pressure, there is a possible risk of sanctions against Sri Lanka. How will this affect trade between the EU and Sri Lanka?
A: I think sanctions would be a catastrophic mistake by any international organisation. In the European Parliament there are over 40 members who support Sri Lanka and the number is growing. We will educate the EU Chamber as well as the minister about this progress.
Sri Lanka can’t be the world’s best kept secret. Unless politicians especially in places like the European Parliament know the progress that has been made here, they will believe the information given by people who are hostile to Sri Lanka. Sri Lanka needs to alert the people about the progress you have made. It is very important that people who are in the positions of influence like members of parliament not only in Europe but in other places too fully understand the situation.
I personally believe that whoever is trying to bring sanctions on Sri Lanka should understand that it’s been only five years since a long conflict has ended. It takes a long time to heal the wounds. I don’t think sanctions would be the way to encourage situation.
Q: What do you think about the allegations on rights abuse and war crimes against Sri Lanka?
A: If there are allegations, they have to be investigated. On the other hand, the Government should continue to carry out the reconciliation work internally. I also feel that it is important that external pressures don’t destabilise the success Sri Lanka has achieved. We have got enough conflicts around the world. Look at Egypt, Syria and Libya, there are quite a lot of conflicts. Yet here in Sri Lanka you have been able to end a long conflict, stabilise peace and achieve economic growth. I don’t think anyone should disable that. If there are allegations, then they have to be properly investigated but that does not mean Sri Lanka should be destabilised by external forces.
