Business

Trade facilitation agreements helpful to SMEs

12 October 2017 - 57   - 0

Though SMEs are core of a country’s economy, they find it difficult to deal with regulatory processes associated with trading goods across borders. In this context, the operationalization of the Trade Facilitation Agreement (TFA) would simplify international import and export procedures for the SMEs.  
This was stated by Libuse Soukupova, First Secretary, Head of Cooperation, EU Office in Colombo on Wednesday while addressing the opening ceremony of the two day workshop on Trade Facilitation Implementation Plan: Prioritization and Way Forward held in Colombo.
A Rs 1.4 billion project to support Sri Lankan government in implementing its commitments made under the Trade Facilitation Agreement, is to boost Sri Lankan trade. The National Trade Facilitation Committee (NTFC) in collaboration with the International Trade Centre (ITC) and the World Bank convened this 2-day workshop.
Ms. Soukupova continuing said that the workshop would deliberate to prioritize reforms that are critical to improve Sri Lanka’s business environment and the European Union (EU) works alongside Sri Lanka to provide technical assistance through the ‘EU-SL Trade Related Assistance Project’. She said the TFA also works in other areas such as export development and value chain development.
SMEs represent 90 per cent of the global enterprises and provide over 70 per cent employment in the private sector, she indicated and said that in Sri Lanka SMEs contribute more than 65 per cent to the GDP of the country.  She asserted that the this instrument would increase possibilities for SMEs to participate in global value chains and optimize the country’s chances of increasing the export revenue, rapidly, through international trade. 
She pointed out that however, to really benefit from preferential trade agreements with large markets, such as the EU’s GSP +, requires compliance with import requirements and if creatively utilized, GSP + has the potential to benefit the country far beyond zero duty access to the EU.
This opens up the opportunity for new companies to become suppliers to the existing manufacturing businesses or for manufacturers to engage in backward integration, she said.  She noted that country will be able to attract foreign investors to set up manufacturing operations here in order to export to the EU and benefit from zero duty access and all these will undoubtedly lead to greater economic activity and create jobs in Sri Lanka. (Quintus)

 

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