There will be an annual increase in apparel exports to the tune of US$ 500 million as a result of regaining the GSP+ benefit creating over 20,000 job opportunities as well, said Minister of Minister of Development Strategies and International Trade Malik Samarawickrama.
Speaking at the SAARC Investment Summit held at Colombo Hilton he said that considerable gains were expected through the exports in agriculture product categories such as fresh and processed vegetables and fruits and processed foods including coconut related products.
“The Fisheries sector too expects a substantial growth and the demand for fisheries products would double. Till June 2017 fisheries exports risen by over 40% compared to the same period last year.”
Ceramics and porcelain, footwear, bicycles, leather products and the light engineering product sector are all set to benefit.
“Under the proposed China FTA, we are focusing on apparel, tea, gems and jewellery, rubber products, coconuts and spices as key industries. Together the Chinese FTA and Indian ETCA will give Sri Lanka preferential access to a market of 2.5 billion people and an emerging middle class larger than the whole of the EU.
“We have also launched negotiations on a FTA with Singapore and we are particularly focused on encouraging Singaporean investment into Sri Lanka and new concepts such as re-manufacturing industries. Sri Lanka’s FTA with Pakistan also provides an opportunity for Indian investors to access that market on a preferential basis by locating in Sri Lanka. We could explore the possibility of redirecting some of the Indo-Pakistan trade currently transmitting through Dubai.” Speaking on the opportunities within the SAARC region he said that the region remains one of the fastest growing regions of the world with the growth rate of 6.8% in 2016, which was down from 7.5% in 2015 as per World Bank reports.
GDP of the region was USD 2.89 billion in 2016 predominantly driven by the GDP of India which accounts for 78%, followed by Pakistan and Bangladesh, at 10% and 8% respectively. The 8 SAARC countries including Sri Lanka are developing countries and need trade not aid and export growth can no longer just depend on traditional export markets such as the USA and the EU, where demand is slack.”
The ETCA with India can increase Sri Lanka’s competitiveness in industrial exports.
“ Our Government is committed to improving the Ease of Doing Business in Sri Lanka under the theme Sri Lanka means business. We are undertaking major infrastructure projects including our first LNG based power plant and terminal led by India and Japan, the Western Megapolis Light Rail with Japanese collaboration, and the extension of the Southern and the new Central highways. LNG Commercial operations are expected to start in 2020 with the generation of 600 MW of electricity from existing power plants converted to run on LNG followed by a further 1300 MW of new power by 2020.”
No need to pay corporate tax until investment recovery under new IR Act
The new Inland Revenue Act (IR) provides attractive concessions for the investments in Sri Lanka where one will not need to pay corporate tax until the investment is fully recovered, said Minister of Minister of Development Strategies and International Trade, Malik Samarawickrama.
Amendments will be made to the Inland Revenue Act and the new bill is currently at Parliament Stage for debate and the new tax act simplifies the existing one and reduces indirect taxes and provides several investment incentives. Investment in the Northern Province will too have additional benefits.
The government has recognized that its policies and behaviors play a critical role in shaping the investment climate and is committed to creating an environment in which firms and entrepreneurs have opportunities and incentives to invest productively, create jobs, enhance private sector competitiveness and thereby contribute to strong economic growth. (SS)
Sources : hospitality