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Wednesday, March 03, 2010 - 08.00 GMT |
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SL should
utilize regional trade agreements– Economist |
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Sri Lanka could try and exploit its under-utilized trade agreements with South Asian regional countries to compensate for the looming loss of General System of Preferences (GSP) Plus in mid August 2010, a senior economist has said.
Executive Director of the Institute of Policy Studies (IPS), Dr. Saman Kelegama says that strengthening of trade links with other South Asian countries apart from India and Pakistan will now be important as the preferential access to the EU market via GSP-Plus is presently in doubt.
“This market still remains unexploited and there are opportunities for ‘win-win’ cooperation,” Dr. Kelegama said pointing out that intra-SAARC trade still hovers around 5% compared to 25% of intra-regional trade in the Association of Southeast Asian Nations (ASEAN), 54% in European Union, and 59% in North American Free Trade Agreement (NAFTA).
“We should not forget that out of the regional population of 1.5 billion, 550 million of them belong to the middle class category, which is a bigger consumer market than EU and NAFTA combined,” Kelegama said adding that the South Asian intra-regional trade is less than 1% of South Asia’s GDP compared to 20% in ASEAN.
“The existing pattern of intra-regional trade in South Asia fails to capture the extent of complementarities in the region due to high incidence of non-tariff barriers (NTBs) and informal trade,” Kelegama stressed.
Dr. Kelegama made these statements at the launch of a new book titled, ‘Promoting Economic Cooperation in South Asia,’ jointly edited by Dr. Saman Kelegama, Vice Chairman of the Policy Research Institute of Bangladesh, Sadiq Ahmed, and Economic Advisor at the World Bank for South Asian region, Ejaz Ghani.
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