Archives

Free trade and equitable development

Something which is glaringly anomalous about South Asia was pointed out by Commerce Minister Ravi Karunanayake after the signing of the Pakistan- Sri Lanka Free Trade Agreement on Thursday. This was the fact that although the South Asian region accounted for one fifth of humanity, trade among the countries of this region read an abysmal 1.2 percent. Certainly, the economic and trade potential of this vast South Asian market is going untapped probably because the regional bloc, SAARC, is yet to get its act together.

Bilateral disputes among some South Asian states have been hampering the promotion of regional amity and this has put paid to hopes of getting the SAARC machinery going at the desired pace. However there is no getting away from the fact that mutually-beneficial bilateral trade pacts could make some amends for these drawbacks. This is why the Pakistan-Sri Lanka Free Trade Agreement which was inaugurated during Pakistani President, Gen. Pervez Musharaff's visit to Sri Lanka this week must be warmly welcomed.

The Government, it seems, is exploring every avenue of expanding Sri Lanka's export market. Prime Minister Ranil Wickremesinghe's recent visit to the US bore this out clearly. Expanded bilateral and multilateral trade links are essential for the survival of national economies amid globalized economic linkages. However there is no predicting the global market. Quota system trading, particularly in the area of garments, which is one of the mainstays of the Lankan economy, could experience sudden vicissitudes to the disadvantage of economies such as ours.

We need to continuously expand our international trade links and exploit the opportunities which are opening up in overseas markets but there is no ducking the fact that intra-regional trade must be stepped up. This represents a vast market at our doorstep, which is going unutilized. For regional trading blocs constitute one of the best answers to the protectionist-prone global markets which have been shrinking in regard to vital Third World exports.

The same goes for travel and tourism. Instead of waiting in suspended animation for the Western tourist who has become increasingly scarce on account of the unsettled conditions in South West Asia, the countries of this region should look to exploiting their tourism markets on a cooperative basis. Accordingly, the Pakistan-Lanka Tourism Agreement should also be welcomed. The expanding middle class in both India and Pakistan offer a substantial tourism market which could be tapped.

It augurs well for the future, therefore, that Sri Lanka has launched free trade agreements with both India and Pakistan. As the Pakistani President observed, inter-state relations in the 21st century are bolstered by sound economic and trade links. This is certainly true in the case of bilateral state relations. But multilateral trade and economic relations need to be also fostered if the regional economic bloc concept is to take substantial shape. This calls for a reduction of inter-state tensions. The European Union has soared ahead as a regional economic bloc on account of its political unity. This fact shouldn't be lost sight of.

Trading on a concessional basis is an essential aspect of bilateral free trade pacts. To facilitate this process the states of South Asia need to take a hard look at the economic complementarities of the region. One feature which shouldn't go unnoticed is our vast populations. Our masses need to be mobilized fully if these free trade agreements are to yield their fullest benefits. Besides, economic benefits need to seep down to the people if new economic regimes are to be justified.

These considerations call for economic development plans which would bring the people fully into the picture. It must be remembered that grand economic plans would come to nought if the people are to remain steeped in poverty and want. What needs to be considered is how our poverty alleviation plans could be dovetailed with the overall economic development strategy. Let not the people be left out in the cold.

News | Business | Features | Editorial | Security
Politics | World | Letters | Sports | Obituaries |

Produced by Lake House
Copyright 2001 The Associated Newspapers of Ceylon Ltd.
Comments and suggestions to :Web Manager