‘Lanka, Korea trade growing by 7%’

The National Budget 2018 has some of the strongest announcements of liberalization seen in years, including the removing of para-tariffs on 1,200 imported items, said Minister Malik Samarawickrama

Speaking in the Republic of Korea, he said that the budget also announced very progressive steps towards UN sustainability goals by declaring that all government vehicles will be either hybrid or electric by 2025, and dramatically reducing taxes on electric cars.

The focus of the government is to shift the economic growth model from one that was heavily dependent on public infrastructure spending, to growth driven more by private enterprises, exports, and foreign direct investment.

“Our government is now firmly focused on making the country more open to the world and become an attractive place to do business. We are also committed to improving the ease of doing business. Yes, we have slipped on the rankings recently but that has only made us more determined to double up our reform efforts. By next year you will see the results as we have taken several measures in this regard. Sri Lanka has been most successful during times of greater outward orientation, when it was more open to exports and FDI. But for sometime during the past decade we had slipped on this, and growth was driven more by domestic activity.”

The total trade between Korea and Sri Lanka is now just under US$ 400 million and has been steadily increasing and exports to Korea over the last 5 years have been growing by 7% each year, but there is a lot more potential to grow this in the further,” he said.

“We would also like to diversify our exports to Korea, beyond the current focus on apparels, coconut products and rubber products. Sri Lanka is keen to be a partner of Korea’s supply chain especially in automobiles and electronics products.”

“The new Logistics and Industrial Zone in the south of the country – in Hambantota – is being developed with Chinese investment and we expect a lot of investor interest in this”

“While we are of course very keen to attract Korean investment to Sri Lanka, we are even keener to attract Korean know-how and technology to Sri Lanka.”

“More broadly on the macroeconomic front, we are taking measures to build strength and resilience.”