Sri Lanka enjoys a beneficial trade relationship with the US, according to the President of the American Chamber of Commerce in Sri Lanka (AmCham Sri Lanka) Presantha Jayamaha: “The US is our largest buyer of goods and services with more than US$ 3 billion in exports destined for the nation.”

“A total of 30 percent of our basket goes to this single country while we only import about 400 million dollars in goods and services from the United States,” he stated, explaining that Sri Lanka benefits from a substantial imbalance in this trading relationship, which also provides access to foreign exchange.

On the other hand, the island is a net importer of goods from India and China with the US imbalance helping offset these trades.

Jayamaha noted that during the pandemic, Sri Lanka’s apparel and software businesses have performed well, and continued to function in the prevailing environment: “This is because our manufacturers pivoted to personal protective equipment (PPE) and other goods. The main buyer in this case was the US – even during the lockdowns.”

“It’s pertinent to know that the American consumer market dictates much of Sri Lanka’s export opportunities,” he added, maintaining that “because of this, several large Sri Lankan businesses engaged in that market continued to do well.”

He asserted: “We need to recognise the importance of and appreciate the role that the US market plays for our export businesses. As it’s important to have large companies and brands operating in Sri Lanka, AmCham Sri Lanka, the Ceylon Chamber of Commerce and the Board of Investment of Sri Lanka (BOI) are working to attract substantial investments from the United States.”

From a foreign direct investment (FDI) perspective, most countries experienced a challenging 2020. And as Jayamaha explained, not much could be done given the restrictions imposed across the world.

Despite this, he believes that the BOI played an important role in attracting FDIs to the country by helping organise the Sri Lanka Investment Forum 2021 among other initiatives: “These are proactive and interesting vehicles to disseminate the message that Sri Lanka is waiting to do business with others.”

Sharing his opinion on Sri Lanka’s medium-term outlook given the impact of the pandemic, Jayamaha expects to witness a recovery this year, citing initiatives such as delaying tax payments and offering debt moratoriums.

However, the country’s substantial external debt had led to it being downgraded by international rating agencies, which impacts its ability to attract FDI.

“We must understand that Sri Lanka continues to have a strong brand and it is in our best interest to maintain that reputation,” Jayamaha stressed, explaining that remedial action must be taken immediately.

Intellectual property (IP) law is among AmCham Sri Lanka’s areas of interest and one in which the chamber has been an advocate for decades. “We work with governments and different agencies as some major brands are not willing to operate in Sri Lanka unless our IP laws are strong,” Jayamaha revealed.

Providing insights into this area, he elaborated: “There are effective laws and legislation but the shortfall is in strategic policies, and coordination among entities in implementing and executing them.”

“IP laws also protect Sri Lankan industries,” Jayamaha maintained, continuing: “Business owners would have no issue allocating 20 percent of their budgets to create IPs and patented technologies because these companies would know they would be protected.”

“Intellectual capital is something we need to protect, not only for global companies but for local businesses as well,” Jayamaha said, asserting that “we need to respect others’ properties, and create the environment for Sri Lankan companies to invest a substantial share of their earnings and resources in creating IP and technology, as well as bringing the country and what we do to the forefront regionally and globally.”