By Nasriya Naffin
According to Vice Admiral Mohan Wijewickrama, the Sri Lankan High Commissioner, Sri Lanka is considering the China-Pakistan Economic Corridor (CPEC), which could help strengthen trade relations with Pakistan while expanding business opportunities with the Central Asian Republics (CARs).
The high commissioner added during a meeting at the Karachi Chamber of Commerce and
Industry (KCCI). “Sri Lanka’s trade can be developed by connecting Gwadar Port with Colombo
Port, which is one of the biggest ports in South Asia, wherein two more terminals, Eastern and Western terminals, are being developed despite the economic meltdown suffered by the country,”
He was upbeat about Sri Lanka's recovery from the financial crisis. He claimed that because of periodic debt accumulation by the governments, the nation would be unable to repay its loans by 2021.
According to Wijewickrama, the then-government had to decide between paying the debt and keeping the populace hungry or feeding the crowd while forgoing loan payments.
“The government is quite confident that Sri Lanka will come out of economic crises as political stability has been achieved and negotiations are also underway with the IMF for an extended economic facility with restructured loans while reforms will also be introduced in the loss-making enterprises.”
He continued by saying that the Covid-19 pandemic had caused significant issues for Sri Lanka because its hotels and small and medium-sized businesses had to close down during the pandemic.
“Now, we are in the right direction, and we have to make necessary corrections before we take off and are able to do business with our friends.”
Commenting on the 2005 Sri Lanka-Pakistan Free Trade Agreement (FTA), he said that the agreement caused trade volumes to double and that the trend persisted for a further ten years before eventually becoming stagnant.
“Under the FTA, trade should have reached at least $2 billion, but unfortunately, it did not happen as we both are exporting to other countries and importing from other countries instead of each other,” he opined.
He emphasized that members of the South Asian Association for Regional Cooperation (SAARC), which outperformed the Association of Southeast Asian Nations (ASEAN) in terms of GDP and population, must look into ways to improve trade within the SAARC region.
“We will not need to look at anywhere else if we take steps to promote trade amongst SAARC countries.”
The high commissioner praised Jagath Abeywarna, the Sri Lankan consul general in Karachi, for his efforts.
“a lot of activities have started taking place in Karachi thanks to all the sincere efforts made by Jagath Abeywarna, which encourages us in Islamabad that although it is late, it won’t make a difference as we can kick off from now onwards to see trade between the two countries going up.”
“There are a lot of opportunities available, so all of us must look at them positively,” he added.
Earlier, Tariq Yousuf, president of the KCCI, said that despite the 2005 signing of the Free Trade Agreement, trade between Pakistan and Sri Lanka only totaled $457 million, which was extremely low and required special attention from both parties.
He emphasized that for greater ease in comparison to other countries, both countries must consider the possibility of removing trade barriers.
Yousuf believed that a two-way currency swap arrangement should be pursued, allowing both nations to exchange their domestic currencies for dollars.
“This would further strengthen their financial cooperation and deepen their economic relationship.”
To enhance bilateral economic cooperation, he added that Sri Lankan investors and their corporate sector should take advantage of the potential for joint ventures in Pakistan's enormous energy sector, cement, textile, motorcycles, cars, Basmati rice, livestock, and maritime.
Yousuf emphasized the effects of CPEC on regional economies and urged Sri Lanka to join the initiative, claiming that doing so would aid the crisis-stricken nation in strengthening existing ties through increased regional connectivity and be advantageous for achieving economic growth and development.
“The strategic troika comprising Pakistan-Sri Lanka and China can offset the growing concerns of regional states and overcome the emerging geo-economic challenges.”
The KCCI president emphasized the importance of improving air and maritime connections between the two nations to advance trade and economic growth.
According to him, both countries should ensure that the FTA is implemented effectively and promote business-to-business and people-to-people interactions. Host frequent cultural and educational exchanges and create policies and conditions welcoming foreign investment to strengthen bilateral economic ties and further increase connectivity.