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| Sunday, 6 June 2004 |
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Regional trading better than 'going it alone' - Indian Deputy High Commissioner by Elmo Leonard The best trading approach for South Asia is to trade regionally with the many existing and emerging trade blocs of the world, instead of each South Asian nation going it alone, and in the process competing with one another. This was the view of the Deputy High Commissioner for India in Sri Lanka, Shri Mohan Kumar, who made the strongest impact, at the opening session of the Asia-Invest Forum 2004, concluded in Colombo last week attended by 85 delegates from EU member states and a host of Asian nations. While all South Asian countries are developing, it is even more easy to justify regional integration under the WTO agreements, Kumar, said at the forum described as the most significant event in the Asian investment calendar, conducted by the European Union. The local collaborator for the Forum third in an annual series, was The Ceylon Chamber of Commerce, with 90 Sri Lankan companies in participation. The EU today is the largest trade bloc in the world, with 25 member nations. Kumar scoffed at different South Asian nations coming under different trade tariffs for exports of their goods to the EU. "There is no running away from regional trade agreements and even India and Japan which previously shunned regional trade and free trade agreements are now left with no choice," he said. Against this backdrop, South Asia is the only region, except Africa, which has not been able to carry out full regional integration, the reasons being inter-state political differences, taking preference over economic issues and/or competitive export capabilities not being convincing to South Asians. However, South Asian regional economic integration was no longer a choice but an imperative necessity, the Deputy high Commissioner said. South Asian nations are now adopting a liberal investment regime, and it was therefore important that countries adopt a more favourable regime for investment within the region, he stressed. However, the critical factor was what kind of investment is to be permitted. Kumar, said that while bilateral investment promotion agreements already exist, the question is to have a regional framework for protecting investments. He also called for transfer of technology within companies of the region if the region is to become more competitive, globally. In this respect, Sri Lanka was ahead in packaging and in textile machinery management. India was superior in IT, and such complementarities within the region needed to be exploited. In services, the areas of importance is air travel, people-to-people contacts, freight and insurance services, which need to be liberalised so that the region could become more competitive. Taking the example of the decision of both India and Sri Lanka to have an open skies policy is a landmark for the region is worthy of emulation, Kumar said. Head of the Trade and Economic Affairs, Regional Delegation to the European Commission in India, Stefano Gatto, said that trade between the EU and the South Asian countries is domionated by trade in textiles/clothing and this sector represents by far the largest export items for most countries. For Bangladesh, it is 87 percent, Pakistan 72 percent and Sri Lanka 57 percent. Phasing out quotas under the MFA will pose a considerable challenge for many of the South Asian countries, Gatto said. The EU is doing its part in trying to alleviate negative impacts through its trade policy and TRTA, but countries must also ensure that their domestic business environment promotes competitiveness and is conductive to investment, he said. Supporting economic development through trade is at the heart of EU trade policy and the EU is supporting South Asian countries further integrate into the world economy through its TRTA programmes. Also EURO 70 million is devoted to South Asian countries up to 2006. These include programmes to help countries deal with EU SPS and technical regulations and standards so these do not act as barriers to trade, Gatto said. Charge Affairs of the Delegation of the European Commission to Sri Lanka, Woulter Wilton, assured that the EC would like to re-confirm to the Sri Lankan government its fullest commitment not only of the ongoing peace process and the humanitarian projects but also to the economic progress of Sri Lanka. He hoped this forum as well as the EU-Sri Lanka Partenariat event which was held at the end of the week, would further contribute to the commitment, he said. |
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