Advantages & Disadvantages of Sri Lanka Entering Into Free Trade Agreements

Topics: International trade, Sri Lanka, Economics Pages: 4 (1033 words) Published: April 16, 2012

History of Sri Lanka02
Sri Lanka’s First Trade Agreement04
Traditional Sri Lankan Export Commodities04

In this assignment I am doing to discuss the advantages and disadvantages of Sri Lanka entering into regional trade agreement with its neighbors History of Sri Lanka
Sri Lanka is a known country for the trade during the ancient and medieval times. Its native high quality products such as Gem Stones, Ivory and Spices have gained popularity not only the neighboring countries like India, China & Persia (Present day Iran) but also in ancient Kingdoms such as Greek & Rome. Facts of Sri Lanka has mentioned in Greek and Roman writings dating from the third century BC by Kalisthenes, Oneskritus, Megasthenes, Strabo, and Pliny. Also Sri Lanka was included in the map of Asia, drawn in 150 AD by Ptolemy.

Ptolemy’s Map of Sri Lanka (Taprobane)

Location of Sri Lanka in the world map

Sri Lanka’s First trade Agreement
In 1952 Sri Lanka entered into a Rubber-Rice barter agreement with China. Under this agreement 01 ton of Sri Lankan Rubber has exchanged to 06 tons of Chinese Rice Traditional Sri Lankan Export commodities

Sri Lanka’s traditional Exports were Tea, Rubber and Coconut products and after 1977 the Apparel industry too added to this. But, it is not viable any more to depend on these products in the long run due to the competition, trade barriers, high taxes, substitutes, political differences and recessions in countries etc. Therefore as the mission statement stated by the Department of Commerce of Sri Lanka “To develop and Promote Sri Lanka’s foreign trade relations at bilateral, regional & multinational levels by the effective implementations of government trade policy, with a view to raising the standards...
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