Holds constructive discussions on moving forward the Sri Lanka - U.S. Trade and Investment agenda

A preliminary study on Sri Lanka - U.S. FTA predicts 3.5% GDP growth in Sri Lanka

Hon. Jeyaraj Fernandopulle meets US Deputy Secretary of Commerce Hon. Ted Kassinger

Hon. Jeyaraj Fernandopulle, Minister of Trade, and Commerce & Consumer Affairs concluded his four-day visit to the US moving forward the bilateral trade and investment agenda. On Tuesday, June 22, he met with his Commerce Counterpart Hon. Ted Kassinger, Deputy Secretary of Commerce (acting for Secretary of Commerce who is on an official visit to China) and Representative Jerry Weller, a key Congressional ally of Sri Lanka and attended a meeting at the International Institute for Economics (IIE), a Washington based trade think tank.

Minister meets Commerce Counterpart

At the meeting with Hon. Kassinger, the Minister Fernandopulle emphasized that Sri Lanka will continue to maintain the momentum gathered thus far in the US-Sri Lanka trade and investment relations and that the new Government will continue to engage with the US to deepen and broaden the trade and economic relationship.

The development of the rural sector and upliftment of living standards of the people will receive special attention of the new Government. In this regard the Government will continue the poverty alleviation programme - “Samurdhi Scheme”- to generate self-employment and provide micro financing to needy people. The Government will also encourage foreign direct investment into Sri Lanka, which is strategically located between the East and West as a gateway to the vast Indian market. The Sri Lanka-India Free Trade Agreement has opened up many avenues for foreign investment in Sri Lanka. Minister Fernandopulle also explained that Sri Lanka had revised the country’s Intellectual Property Rights legislation, which will be enforced strictly to protect intellectual property rights.

Hon. Kassinger welcomed the strict enforcement of Intellectual Property Rights, which he said would lead to increased investment in Sri Lanka. It was noted that Microsoft and Oracle have opened business offices in Sri Lanka. Discussing government procurement, the Minister informed that the new Government plans to ensure a fair and transparent Government procurement process in Sri Lanka. Minister Fernandopulle also noted that Sri Lanka is working towards signing the WTO Information Technology Agreement. He added that Sri Lanka, as a trade dependent economy, will continue to work constructively with the international community to ensure the successful conclusion of the Doha Development Agenda.

The Minister also discussed the implications to Sri Lanka arising from the abolition of textile quotas in 2005. Members of the Sri Lanka business delegation who participated in the meeting highlighted their adverse experience with regard to specific textile quota categories that have already been phased out. Hon. Ted Kassinger explained that the US is aware of the painful adjustment that the abolition of quotas involved and pointed out the necessity for Sri Lanka to diversify its export base.

The business delegation describing the strategic partnerships they have formed with US companies described the conducive business environment in Sri Lanka for foreign investors, which includes transparent investment laws, sophisticated legal and regulatory framework, generous fiscal intensives, free transfer of fees, profits, capital earnings, a highly trainable labour force, high literacy ratio, efficient port facilities etc. The Sri Lanka business delegation also informed that the Joint Apparel Associations Forum is planning a visit to North Carolina to meet with the textile fabric manufacturers to explore the possibility of increasing imports from US manufacturers.

Capitol Hill Meeting

Hon. Trade Minister in conversation with Congressman Jerry Weller

Minister Fernandopulle met Representative Jerry Weller (Republican-Illinois), who is Co-Chair of the Sri Lanka Congressional Caucus of the 108th Congress and a ranking member of the House Ways and Means Committee responsible for trade matters. HE discussed bilateral trade and economic matters such as the trade and economic policies of the new Government, Trade and Investment Framework Agreement (TIFA) process and the Peace Process. Hon. Fernandopulle informed Representative Weller that the purpose of his visit as the Trade and Commerce Minister of the new Government was to establish contacts with the US Administration, Congress and the business community to take forward the trade agenda and work towards concluding a FTA with the US. The Minister further informed that his meetings with the USTR, Department of Commerce and the US-Sri Lanka Working Group have been very fruitful. He added that the TIFA process will continue to address bilateral trade and investment issues and to build confidence between the two countries towards the eventual conclusion of a Free Trade Agreement with the US.

Responding to a question raised by Representative Weller, the Minister explained that the new Government has taken steps to recommence the peace negotiation, highlighting that the ceasefire between the Government and the LTTE is continuing to hold.

The Minister invited Representative Weller to visit Sri Lanka on a Congressional delegation. Representative Weller explained that 2004 being the election year, it was difficult to organize such a Congressional delegation. However, he was optimistic about a Congressional delegation visiting Sri Lanka in early 2005. Representative Weller expressed his satisfaction at the assurance that the TIFA process will continue with a view to concluding a Free Trade Agreement between the two countries.

Hon. Jeyaraj Fernandopulle at the briefing conducted by Mr. Fred Bergsten, Director and Mr. Dean A. DeRosa,
a Visiting Fellow of the International Institute for Economics (IIE)

Hon. Jeyaraj Fernandopulle attended a briefing conducted by Mr. Fred Bergsten, Director and Mr. Dean A. DeRosa, a Visiting Fellow of the International Institute for Economics (IIE) for a presentation of the findings of a study conducted by IIE entitled “The Prospects of a Free Trade Agreement Between Sri Lanka and the United States”. The first part of the study, which has been completed indicates that the proposed Sri Lanka - US FTA will have far reaching positive implications on Sri Lanka’s economy and predicts that the GDP of Sri Lanka will grow by 3 to 3.5% annually resulting from the FTA. Studies conducted by Washington based think-tanks such as the IIE are being used by US policy makers, business community and industrial organizations to make decisions on issues covered by such studies. The IIE is a private, non-profit, non-partisan research institution devoted to the study of international economic policy.

While the Minister was in Washington D.C. Hon. Christina Rocca, Assistant Secretary of State for South Asian Affairs who testified before the US House of Representatives Committee on International Relations on “United States Interests and Foreign Policy Priorities in South Asia” affirmed that Sri Lanka has the potential to be a vibrant economy and the US “will revive talks on the proposed FTA”. She also mentioned that the Minister of Trade, Commerce & Consumer Affairs of Sri Lanka who was presently in Washington D.C. had clarified that the new Government would continue aspects of the economic relationship which made the Sri Lanka-US FTA possible. Hon. Rocca stated that the US was assured that “Sri Lanka wants to move forward to take its place in the global marketplace”.

Minister Fernandopulle accompanied by a private sector delegation concluded his four-day visit successfully moving forward the Sri Lanka-US trade and investment agenda with the US government and private sector and reviving the talks on a proposed FTA with the US.

Embassy of Sri Lanka
Washington DC
USA

23 June 2004