Sept 14, Colombo: The United States says it believes that creating economic opportunity must go hand in hand with political reconciliation to lay groundwork for sustainable economic growth that provides opportunities for all Sri Lankans.
The United States Assistant Secretary of State for South and Central Asia Robert O. Blake, who is in the island on a three-day official visit, said today a key part of pursuing a better future for all Sri Lankans is the implementation of the Lessons Learnt and Reconciliation Commission (LLRC) recommendations, to ensure a democratic, just, secure, and prosperous future for all Sri Lankans.
Delivering a speech on "Strengthening U.S -Sri Lanka Economic Ties "at the American Chamber of Commerce Luncheon held at the Jaic Hilton this afternoon, the high ranking U.S. official said a strong economic partnership will be another important part of achieving that vision.
According to Blake, the United States Agency for International Development (USAID), the aid agency of the U.S. government, has established Public-Private Alliances with Sri Lankan companies to expand operations into the North and East to create new opportunities and better livelihoods.
These partnerships are helping to re-activate the local economies of the North and East and laying the groundwork for sustainable economic growth that provides opportunities for all Sri Lankans, the official said.
"We believe that creating economic opportunity must go hand in hand with political reconciliation," Assistant Secretary Blake emphasized.
Speaking of trade relationships, he said the U.S. is the largest single export destination for Sri Lankan goods, importing over 20 percent of Sri Lanka's exports worth US$ 2 billion while Sri Lanka only imports US$ 300 million worth of goods from the United States.
"That's a balance of $1.7 billion dollars every year in Sri Lanka's favor!" the envoy said.
He pointed out that the U.S. would like the trade relationship to grow and advocates strongly for American companies to invest in Sri Lanka.
"We see opportunities for U.S. companies in sectors ranging from tourism and infrastructure development to information technology," the official said hoping that Sri Lanka's economy, which has grown by 8 percent annually in the last two years, will continue to grow.
Blake underscored the need for greater foreign direct investment and continued expansion of the export sector to sustain the economic growth and said the U.S. is continuing the Trade and Investment Framework Agreement (TIFA) talks, which can open and encourage foreign direct investment in Sri Lanka.
The new TIFA Labor Sub-Committee will help ensure that any labor concerns are resolved quickly, hopefully avoiding future GSP problems, the Assistant Secretary said.
However, the U.S. official said many new U.S. companies have not come to invest in Sri Lanka as the investors are facing an uphill battle in Sri Lanka's marketplace due to various administrative barriers.
The barriers include confusing and opaque rules on bidding for contracts, unpredictable government regulations such as the recent so-called Under-utilized Assets bill, and corruption, the envoy highlighted.
Although the government has made progress in developing ports, aviation, and other infrastructure, these are not enough to realize the true potential of the Sri Lankan economy, he said.
"You have the human resources, and you are building the infrastructure," the Assistant Secretary said urging for changes in the business practices.
"With more aggressive reduction of tariff and non-tariff barriers, and liberalization of the rules for foreign direct investment, I am confident that the economy, and our bilateral trade and investment, can grow even more quickly," Secretary Blake said.
He urged the business community, not to be resistant to changes and make the changes to the business practices, as the benefits are worth the effort and it is very much in their interest to help promote such changes.
"The United States will do its part by continuing to advocate for trade and investment in Sri Lanka, and we look to our partners to join in this effort that will help build a more democratic, secure, and prosperous future for both of our countries," Assistant Secretary Blake said.
Earlier in his visit the Assistant Secretary met with ministers, Secretary to the President, opposition party leaders and other civic society leaders to discuss the progress of Sri Lanka's political reconciliation process.