Lanka and the Maldives should complement each other's economies - Prof. Peiris

Sri Lanka and the Maldives should meaningfully and productively complement the economies of each other, by sharing industrial potential and capabilities, said Export Development and International Trade Minister Prof. G.L.Peiris addressing the launch of the Sri Lanka-Maldives Bilateral Business Council in Colombo.

The Minister said though the Maldives is not rich in agriculture, tourism which is the heart of its economy is booming contributing one-third of the country's GDP and 90 percent of state earnings.

Over 75 percent of the foreign exchange earnings are through tourism. Sri Lanka produces quality vegetables, fruits, cinnamon, ceramics, textiles and garments which can be of immense benefit to the tourism industry in the Malidives, Prof. Peiris said.

Despite limited land and resources the Maldives has sustained a higher economic growth rate of over 10 percent and the per capita income is around US$ 3,900. The economic growth rate in Sri Lanka is 7.4 percent and the per capita income in the provinces is US$ 700.

The Minister said both countries should depend on their collective strengths to improve the productivity of industries and address trade restrictions such as duty, limitations in cargo space and trade in services. Export earnings through trade with the Maldives from 2001 to 2006 has declined. Sri Lanka's export earnings which were Rs. 3,747 million in 2001 had dropped to Rs. 3, 053 million in 2006.

The quality of tea, textiles and other industrial products exported to the Maldives needs to be improved, the Minister said.

Sri Lanka exports vegetables, electrical machinery and equipment, plastic and plastic products, dairy products, tea, paints, paper and paperboards, boilers and mechanical appliances. Sri Lanka and the Maldives will sign an investment promotion and investment protection agreement in September.

Minister of Economic Development and Trade of the Maldives Mohammed Jaleel said the agreement will further strengthen bilateral relations and boost trade and investment between both countries.

The High Commissioner for the Republic of the Maldives Dr. Mohammed Asim said the setting up of the Business Council was overdue considering the longstanding relations between both countries and that opportunities to enhance trade and investment must be exploited.

The Sri Lanka-Maldives Bilateral Business Council was set up by the Ceylon Chamber of Commerce to strengthen bilateral and trade relations between the two countries.

LF