“Use FTAs to expand exports”
Sri Lanka needs to utilize free trade agreements (FTAs) as an instrument to expand exports rather than looking at it as something to import, says Talal Rafi- International Consultant.
“Vietnam has 15 FTAs while Sri Lanka has only three agreements. Vietnam’s export to GDP ratio is over 100 percent while Sri Lanka hovers around 20 percent. During the period 2000-2015, Sri Lanka brought in only seven new products to the export basket generating USD 100 million in revenue while Vietnam brought in 48 products which brought in revenue of USD 54 billion.” Rafi told a webinar hosted by the Centre for Banking Studies and the Central Bank of Sri Lanka under the theme, ‘How SMEs and Startups Can Navigate the Post Pandemic Business Environment’.
Vietnam has not only continued to add new products to the export basket, they have managed to earn much higher export value. Speaking on local Small and Medium size Enterprises (SME) said many SMEs tend to struggle with basics such as financial management, lack of access to finance, lack of market knowledge etc. SMEs have to be supported and groomed to reach the global market and capture emerging opportunities.
“The majority of SMEs particularly located in rural areas in the country don’t even make an attempt to tap into the Western Province which has a higher spending power. “It is high time to go outside of the local regions and then reach international markets.”
Noting that branding and value addition is imperative for high value export growth, he said consistent government policies are also required to take Sri Lanka’s export industry to the next level.