Sri Lankan econ growth could have been 10 - 12 %

Pakistan’s High Commissioner to Sri Lanka Shahzad A Chaudhry last week said that without war, the Sri Lankan economy could have been galloping now for some time, at the rate between 10-12 %.

“The Sri Lankan trading tradition, entrepreneurial innovation and a strong sense of international linkage has always kept your economy buoyant,” he said at the National Chamber of Exporters (NCE) export awards ceremony held in Colombo.

He said at over US$6 billion exports in 2006 with all signs of being bettered in 2007, is a sign of robust growth. “Many people have asked me how Sri Lanka manages 7% growth rate when a war is on and the economy is seriously afflicted. While, I state, all the above, that I submitted before you, I also add with some sense of grief, it is not what they perform despite war, it is what they fail to achieve because of war,” he said adding “It is my humble submission, that without war, this economy could have been galloping now for some time, at the rate between 10-12 %.”

He said it’s that 5 % loss of growth that “I count in your otherwise very potent economy. But then nations must accept all challenges and sacrifice when they have to.”

Commenting on the trade volume to Pakistan from Sri Lanka, he expressed serious concern and reiterated that the lost sales volume should be captured at any cost. “Your exports to Pakistan, however, or at least an emerging trend therein is a cause of concern. Although, these have improved considerably from a measly US$28 million in 2002 to around US$60 million in 2006, with a consistently increasing trend all through, it was what I noticed in 2007 that is worrying. You are likely to stay stagnated at around the same figure, if not less. I imagine the chamber must look at it closely to uncover the latent reasons. And this despite, us encouraging all of you to partake of the emerging opportunities in Pakistan. I have noticed only two notable successes in the last year – one of Orange Electric, who have broken into the Pakistan market successfully and your highly regarded brand, Dankotuwa, who are in the process of setting foot now in Pakistan,” he said.

He said he had dispatched two groups of at least 60 business people each to Pakistan from here, while 37 Sri Lankan companies exhibited in Pakistan. Similarly, a trade delegation from Pakistan, in the targeted interest commodities and products to Sri Lanka were invited recently. “We must do better with all these opportunities. governments and missions can only take the horses to the pools. The horses must drink of their own accord, and with some effort.”

He also spoke about the Free Trade Agreement between the two countries saying, “I feel, within the Pakistan-Sri Lanka Trade domain, we are afflicted by inertia and tradition. The FTA is a useful vehicle, but it has enabled its potential increase almost nearing saturation. The betel leaf and the coconut will only get us a small distance: although there is still potential with the tea. Sometimes I feel that the FTA tends to limit our innovation. It provides a sustainable but modest trade in commodities, which are greatly dependent on established consumption patterns. Although I feel that Sri Lanka must work harder to regain its lost place in the tea market of Pakistan, while Pakistan must exploit Sri Lanka’s need for textiles, yarn and fabric. There is potential there.

To really grow beyond these traditional commodities, we need to look beyond FTA. We need to expand FTA to include services and investments: we must also include some SME related products and engineering goods in our trade to give real buoyancy to our trade relations. More importantly, we need to review and revise our traditional images of each other. While we continue to be two strong and resilient friends, we have the capability to be a lot more to each other. We must not let the opportunity go waste,” he said. (KK)