Sri Lanka should move towards a manufacturing economy similar to what Malaysia is today, to boost economic growth, Malaysian High Commissioner Wan Zaidi Wan Abdullah told a seminar on ‘Bilateral Trade between Sri Lanka and Malaysia’ organised by the National Chamber of Commerce last week.
Malaysia has leap-frogged from being an agricultural economy in the 1970’s to to a manufacturing economy with a strong GDP growth rate which grew by around 50 percent during the past six years.
“Sri Lanka must push towards a manufacturing industries and not stop halfway. Malaysia’s manufacturing sector accounts for around 55 percent of the GDP manufactures food and electronics and benefits immensely from a vibrant export industry. There should be more investment in the manufacturing sector than the service sector in Sri Lanka,” the high commissioner said.
Sri Lanka and Malaysia trade has been insignificant over the years with bilateral trade touching little over US$ 550 million in 2015. Exports from Malaysia to Sri Lanka was US$ 481 million while imports from Sri Lanka accounted for US$89.5 million.
Sri Lanka and Malaysia which has immense resources should explore new opportunities for trade and investment. The Malaysia Sri Lanka Business Council and the visits of business delegations from both countries will help enhance mutual trade and investment.
Sri Lanka’s main exports to Malaysia are natural rubber and rubber based products (tyres, gloves etc), precious stones, semi precious stones, tea, apparel and coconut and imports petroleum, palm oil, timber, timber products, rubber ,rubber products, cocoa and products ,vegetable fats, chemicals, urea, plastics articles, iron and steel articles.
Both countries have potential for investment in information technology services, textiles, electronics and electronic items, automobile components, garments, rubber and rubber based products, agriculture, agro processing projects and manufacture of traditional goods for exports.
A Free Trade Agreement between Sri Lanka and Malaysia will get off ground soon with negotiations expected to commence shortly. The FTA will take trade to a higher level between the two countries” the high commissioner said.
Malaysia is mulling more trade agreements with countries in Asia as US will scrap the Trans Pacific Trade Agreement when the new administration assumes office next year, a pledge made by president-elect Donal Trump.
The political and economic stability, special development area promoted by the government, a pro business government and liberal investment policies and good infrastructure have made Malaysia a preferred destination for trade and investment.
“Traveling to Malaysia has been made easy today and we are in the process of facilitating visa on arrival soon. Both countries should grab this opportunity to develop the tourism industries of both countries..
Tourist arrivals between the two countries crossed 73,000 in 2015.
A considerable number of Malaysian companies operate in Sri Lanka in the construction sector. Malaysia is a major investor in Sri Lanka bringing US$ 2 billion from Dialog Axiata. - LF