Trade Policy
- Liberalized market economy since 1977.
- Outward looking policies and deregulations.
- Economic growth through private sector participation.
- Stimulus for private investments and export oriented activities.
Major Exports
Garments, tea, gems & jewellery, rubber & rubber products, food preparations, coconut & coconut products, spices & essential oils,, machinery equipments, ceramic products, sea food, ornamental fish, cut flowers & foliage, plants, fruits and vegetables, engineering products, electronic products, plastic products, leather products & footwear, wooden furniture & products, handloom & textiles, handicrafts & gift items, stationery products, herbal products, toys, chemical & chemical products, IT and IT enabled services etc.
Major Imports
With the implementation of reformed import policies in 1977, import structure visualizes a gradual shift from consumer goods to intermediate and investment goods.
Main imports are: Textiles and clothing, petroleum, machinery and equipment, building materials, motor vehicles, transport equipments, electrical equipment, chemicals, food and beverages, wheat, sugar, milk and milk products, fertilizer, paper and paper boards.
Major Trading Partners
USA, India, UK, Japan, Italy, Singapore, Germany, Belgium, Russia, France , China, South Korea, Taiwan, UAE, Australia, Iran, Netherlands, Malaysia.
Free Trade Agreements
Indo - Lanka Free Trade Agreement
Sri Lanka and India signed a Free Trade Agreement in 2000 and the Agreement is now in operation. More than 4200 products can be exported to India on a duty-free basis when products originated in Sri Lanka. For more details, please visit www.doc.gov.lk
Pakistan - Sri Lanka Free Trade Agreement
The Pakistan-Sri Lanka Free Trade Agreement is in operation since June 2005 covering a wide range of products. For more details, please visit www.doc.gov.lk
South Asian Free Trade Area (SAFTA)
SAFTA is now in operation. Member countries are Sri Lanka, India, Pakistan, Maldives, Bangladesh, Nepal, Bhutan. For more details, please visit www.doc.gov.lk
Asia Pacific Trade Agreement (APTA)
Sri Lanka is a member of the APTA. Other member countries are South Korea, India, China, Bangladesh. For more details, please visit www.doc.gov.lk
Global System of Trade Preferences (GSTP)
Sri Lanka is a member of GSTP and a beneficiary under the above arrangement. For more details, please visit www.doc.gov.lk
Generalized System of Preferences (GSP)
Sri Lanka is a beneficiary under the above tariff concession scheme being offered by developed countries. Under this scheme, Sri Lanka can export almost all products on a duty-free basis to 27 EU countries. For more details, please visit www.doc.gov.lk
Trade with Malaysia
Trade between Sri Lanka and Malaysia has been increasing over the last few years and Malaysia has emerged as one of Sri Lanka’s major trading partners.
Sri Lankas main exports to Malaysia:
Natural rubber & rubber based products (tyres, gloves etc), bran, sharps and other residues of milling, precious stones and semi precious stones (e.g. Rubies, Sapphires and Emeralds), tea, bath preparations, shaving or after shave preparations, deodorants, fish, ladies underwear, wheat/meslin flour, articles of jewellery, food preparations, unmanufactured tobacco, machinery parts, articles of apparel and clothing accessories, Rubber gloves, coconut fiber, vegetables (gherkins), brooms and brushes, aluminum plates, sheets and strips etc, natural sands (mineral), synthetic filament yarn..
Sri Lankas Main imports from Malaysia:
Petroleum, palm oil, cement, Aluminum, News print, wood products, electrical items, cement linkers, polymers of ethylene, vegetable fats, chemicals, urea, plastics articles, iron & steel articles, paper etc.
Useful web sites:
- Federation of Chamber of Commerce & Industry of Sri Lanka www.fccisl.org
- National Chamber of Exporters www.nce.lk
- Sri Lanka Export Development Board www.tradenetsl.lk
- Sri Lanka Customs www.customs.gov.lk
- Sri Lanka Tea Board www.pureceylontea.com
- Colombo Stock Exchange www.cse.lk
- Central Bank of Sri Lanka www.cbsl.gov.lk
Why invest in Sri Lanka?
- One of the most attractive investment destinations in the Asia Pacific region
- Offers business-friendly environment favourable to investment and economic growth
- Allow duty-free import of raw materials and machinery for qualifying industries
- Encourage international investment through liberalization of many sectors
- Strategic Location at the cross roads of East – West maritime routes and international time zones – Presently Colombo port rated as South Asia’s leading and service hub
- Infrastructure – Well developed telecommunication infrastructure facilities in South Asia. – International airport ranked first in South Asia.
- Investment friendly policy environment – Total foreign ownership is permitted across virtually all areas of the economy (only a few areas are restricted) – No restriction on repatriation of earnings, fees and capital and on foreign exchange transactions relating to current account payment. – Bilateral investment protection agreements with 26 countries and double taxation relief agreements with 37 countries including Malaysia. – The safety of foreign investment is guaranteed by the Constitution. – Most liberal business and investment environment in South Asia – Ranked 39th out of 150 states with regard to policy environment and investor competitiveness by the World Bank
- Skilled workforce – English spoken, trainable, educated, intelligent, energetic workforce and professionals could be hired at competitive wage rates
- High Quality of Life – Sri Lanka has a high life expectancy rate, high literacy rate, low infant and child mortality rate.
- Transparent Investment laws – Country’s investment laws are transparent and automatic across a wide range of sectors. BOI has the authority to grant exemptions from various laws including Inland Revenue, Customs and Exchange Control.
- Generous Tax incentives import duty exemptions, tax holidays
Extra protection for Malaysian companies
Bilateral investment protection agreement signed with Malaysia on 16.04.1982
Potential areas for investment
- Information Communication Technology Services – Electronics & Electronic items – Automobile components – Textiles, Garments & accessories – Light engineering – Rubber & rubber-based products – Agriculture and/or Agro-processing projects – Mining and processing – Ceramic industries – Gems & jewellery – Manufacture of non-traditional goods for exports – Research and Development – Tourism (resort development) – Infrastructure development (Roads, highways, Power generation, Township development etc) – Real Estate Development – Education
For more details: visit – Board of Investment of Sri Lanka: www.boi.lk The BOI is structured to function as a central point for investors. It operates as an autonomous statutory body directly responsible to the President of Sri Lanka.
Commercial Division of The High Commission The Commercial Division facilitates trade and investment activities between Sri Lanka and Malaysia.