US-China trade war draws trading opportunities for SL
Sri Lanka should capitalise on stresses such as trade wars between other nations.
The continuing fallout from the U.S.-China trade war, which experts say will stretch over the next decade, despite who dwells in the White House will open immense trading opportunities for emerging nations.
They predict the upshots of US-China tensions to result in a further shift of China’s low-wage and high-tech manufacturing jobs to other countries in Asia. They say that as the two countries clash, companies distressed by high tariffs are looking to manufacture their products elsewhere, and businesses outside of the US and China are seeing economic booms.
They also see an opportunity for Sri Lanka in disruption through the trade war between the two giants. “Many industries are moving out of China and going to South and East Asia. Sri Lanka needs to conduct a study and bring some industries in,” an analyst told the Business Times. Sri Lanka has a sellig point in being the gateway to other South Asian countries and it can be a springboard to the Asian continent, he continued.
At a recent roundtable organised by Oxford Business Group’s (OBG) themed ‘How can Sri Lanka enhance competitiveness in the age of disruption?’ Jack Huang, CEO, Colombo International Container Terminals agreed saying that trade and investment activities in Sri Lanka benefit from the country’s location along the busy Indian Ocean trade routes, abundant agricultural and industrial exports, and a young, skilled workforce.
Just 19 km separate its southern-most port from a global shipping lane hauling two-thirds of the world’s oil and half of its container shipments.
This makes local ports a natural staging post for cargo intended for India and Pakistan, with some 30 per cent of the former’s container traffic currently trans-shipped through Sri Lanka. “The country should promote its ‘free port’ status,” Mr. Huang noted.
He also added that the Hambantota port got a lot of flak saying that it will be a military base for China. “But the only warships that have come to the port have been Japanese and US ones,” he said eliciting laughter from the audience.
Sri Lanka has long served as an important strategic destination in the Indian Ocean, catering to merchants and travellers from Southeast Asia, India, West Asia and East Africa. Mr. Huang stressed that the country should hunt opportunities based on this advantage.
Sri Lanka’s position along key Indian Ocean trade routes can enable it to become a prime logistics hub and service provider for these two huge markets, attracting investment in infrastructure and innovative industries, Patrick Cooke, OBG’s Regional Editor for Asia, who moderated the proceedings, noted.