Trade Relations between Sri Lanka and the U.S.

March 28, 2017 at 2:32 pm

US – SRI LANKA ECONOMIC RELATIONS – (Trade, Investment & Tourism)

Trade and Investment Framework Agreement (TIFA) between Sri Lanka and the USA

The Trade and Investment Framework Agreement (TIFA), signed by the USA and Sri Lanka on 25th July 2002 in Washington DC, provides an ideal platform for the two Governments to maintain a closer dialogue on a number of areas / fields that are of mutual interest to them.

The Joint Council, formed under the TIFA had held twelve (12) meetings by end 2016. Minister of Development Strategies and International Trade Malik Samarawickrama led Sri Lanka delegation to the 12th US-Sri Lanka Trade and Investment Framework Agreement (TIFA) Council Meeting held on 28th April in Washington DC, which adopted a path breaking Action Plan to boost bilateral trade and investment.

The 12th Council meeting was Co-chaired by United States Trade Representative Michael Froman and Minister of Development Strategies and International Trade, Malik Samarawickrama.

Recognizing Sri Lanka’s potential to become a much stronger trade and investment partner of the United States, during the Council Meeting, the two governments adopted a U.S.-Sri Lanka Joint Action Plan to Boost Trade and Investment.

The Joint Action Plan aims at reaching its goals over a span of five years; its objectives include, among other measures: reforming Sri Lanka’s trade and investment regime to world class standards; improving the competitiveness of Sri Lanka’s current exports; developing new markets, especially those that take advantage of Sri Lanka’s status as a regional services hub; promoting greater interaction between the U.S. and Sri Lankan business communities; greater utilization of U.S. tariff preference arrangements; strengthening of worker rights and promotion of ethical and environmentally sustainable manufacturing practices, especially in Sri Lanka’s RMG sector; reforming the educational sector to make it more responsive to the needs of business; and increased mobilization of all sectors of society, especially women, in business and trade.

US-Sri Lanka Bilateral Trade Relations

The US continues to be the single largest export destination for Sri Lankan products with over 20% of its exports. Sri Lanka’s exports to the US demonstrated an impressive growth of 31% in 2016 compared to 2011. According to the latest trade statistics, Sri Lanka’s exports to the US amounted to US $ 2.81 Billion in 2016.

Total Imports to Sri Lanka in 2016 was US $ 540 million, while total trade turnover between Sri Lanka and the US remained at all time high of US $ 3.35 billion. The balance of trade is in Sri Lanka’s favour amounting to US $ 2.2 billion.

Sri Lanka’s trade with the US   

Year         Exports from Sri Lanka    Imports into Sri Lanka      Balance of Trade

US $ Million                        US $ Million                       US $ Million

2010         1,765                                    178                                       1,597

2011         2,145                                    307                                       1,860

2012         2,114                                    224                                       1,880

2013         2,497                                    353                                      2,144

2014         2,720                                   493                                       2,228

2015         2,800                                    471                                      2,330

2016         2,810                                    540                                      2,270

Source: Sri Lanka Customs