Criticism of Sri Lanka-Singapore FTA not based on facts: CB Governor

By Nishel Fernando
Central Bank Governor Dr.Indrajit Coomaraswamy says the criticism on Sri Lanka-Singapore Free Trade Agreement (SLSFTA) is not based on facts as there are no provisions enabling the free movement of professionals. 

Delivering the inaugural Dr. Saman Kelegama memorial lecture themed ‘Managing Domestic and International Opportunities and Challenges for Stability and Growth’, Dr. Indrajit Coomaraswamy said: “I haven’t seen any provision in SLSFTA to liberalise the movement of natural persons, that means movement of professionals. 

“I have seen a lot of people talking about it, but haven’t heard anyone actually cite the provision in the agreement to enable this. So anybody who claims that, should cite where it is in the agreement.”
The governor noted that these claims have paved the way for the trade agreements to become the most controversial item of the government’s economic liberalisation agenda recently, and hence, he encouraged the government to engage in a very healthy and open debate on the matter.

“Trade policy is potentially the jewel in the crown in my view. I know it’s very controversial, but there’s a national trade strategy now,” Dr.Coomaraswamy remarked. 

He noted that once Sri Lanka enters into FTAs with China and ETCA with India, the country will be in a unique position with having preferential market access to a 3.5 billion market in the European Union, China and India. 

He stressed that capitalising on the country’s location along with preferential market access, Sri Lanka will be able to attract foreign direct investments and to boost exports.

Dr. Coomaraswamy also dismissed the claims that Sri Lanka doesn’t have a proper trade strategy, pointing out that the government has produced a concise document on Sri Lanka’s trade strategy.

“The government has created an enabling environment to move ahead with trade agreements by introducing the Anti-dumping and Countervailing Duties Act and Safeguard Measures Act and it is also working on trade adjustment packages to support companies which will be adversely affected by the liberalisation.”  

Meanwhile, the governor also highlighted that China has been playing a major role in Sri Lanka’s development process.

Responding to the criticism of China’s debt trap diplomacy, he asserted that it’s up to the borrowing country to evaluate the returns of the projects and suggested that the previous government may not have done that.

Commenting on the new developments at the Hambanthota port, which is operated by the Chinese, Dr. Coomaraswamy said that the country would be able to attract several billions of dollars in investments to the proposed industrial zone in the area, which was the centre of two youth insurrections in the past.  

“The Chinese I think have finalised foundational investments for a LNG plant, refinery, cement factory, steel mill and a ship repairing facility,” he said. 

He emphasised that these investments can economically transform the Hambantota and Monaragala districts, uplifting the population.