Asia Pacific Trade Agreement (APTA) under-utilized. Sri Lanka had used less than five percent of preferential tariff lines granted by China.
Addressing the Sri Lanka China Society, senior economist, Dr. Saman Kelegama, Executive Director, Institute of Policy Studies said, "Sri Lanka and China both are members of APTA. This is a potential avenue to expand trade significantly."
However he said that the facility has been under-utilized. Usage of tariff concessions by Sri Lankan exporters were very low, the country has used less than five percent of the preferential tariff lines granted.
"Out of APTA eligible exports 15 percent is has been completely untouched by Sri Lankan exporters."
Dr. Kelegama said that if APTA is utilized significantly it will provide ample opportunities for business expansion, sourcing and bringing in further FDI to Sri Lanka.
However most of the local exporters were not aware of APTA concessions, he said an awareness programme should be held educating exporters on the opportunities.
APTA provided members to give each other a margin of preference over the general tariff levels. Under APTA china provided concessions for more than 1,700 products imported from Sri Lanka at a MOP of 27 percent which covers 50 percent of total exports to China.
Dr. Kelegama said that the both countries enjoy a trade relationship of US$ 1.1 billion, Sri Lanka exports according to the central bank statistics was US$ 56 million for 2009 while imports were US$ 1029 million.
China and Hong Kong together is the second largest Importer for Sri Lanka with a total import of US$ 1546 million, exceeded only by India with US$ 1820 million.
However China and Hong Kong are the 14 th largest destination for Sri Lankan exports surpassing US$ 125 million in 2009.
Dr. Kelegama said that there are further opportunities to expand trade with China. "China’s middle class is growing which will reach 400 million by end 2010 which will increase the buying power of the Chinese people. Exports should exploit opportunities of trade differentiating products to suit all the consumers."
"China has opened its border to Sri Lankan tea imports. Tea exporters were encouraged to participate in the tea fair. Already a Sri Lankan company ‘Heladiva’ has started operating 3 exclusive tea boutiques and hopes to expand up to 100 by 2011, already targeted with 20 by end of this year."
Further Gems and Jewelry and herbal products, spices, seafood’s, vegetables, coconut shells, charcoal, rubberized coir cushions are rising its demand, he said.
~ www.island.lk ~ By Mario Andree