Sri Lanka aims to join global zero-duty IT trade pact
Jul 12, 2017 14:23 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT - Sri Lanka has begun work on joining the Information Technology Agreement (ITA), a global trade pact that scraps tariffs on information technology products and could boost the island’s growing IT exports, the Ministry of Industry & Commerce said.
The World Trade Organisation’s ITA requires each participant to eliminate and bind customs duties at zero for all products specified in the agreement.
Director General of Commerce of Sri Lanka Sonali Wijeratne said joining the WTO’s ITA could help increase IT exports and attract foreign investment.
“The commitment of a country to WTO ITA is now a major indicator to draw a high FDI quantum to the country,” she told a forum for domestic stakeholders on the benefits of the agreement.
It covered Sri Lankan IT industry, policy and trade and customs regimes and was organized by the Department of Commerce and led by two experts from WTO Geneva.
The forum “is an in-depth analysis of two aspects of our IT - its tariff structure and schedule,” Wijeratne said.
Senior Statistician-Market Access Intelligence Section of WTO Eric Shing said that the zero duty on a vast array of high tech products benefits the country both ways.
“Sri Lanka can import such very high tech products totally duty free –which is usually an unimaginable accomplishment since they are high priced. Any hi-tech products exported from Sri Lanka too can immediately benefit by the same zero tariffs at importers’ end.”
The Ministry of Industry & Commerce said the WTO ITA entered into force on July 1, 1997, and the initial value of $1.7 trillion trade had increased to $3 trillion in 2015 after tariff elimination on 201 new products.
These include semiconductors, smart phones, medical equipment, GPS navigation systems, and touch screens.
Minister of Industry and Commerce Rishad Bathiudeen said exports of global information technology products is bigger than the global trade in automotive or pharmaceuticals.
“The ICT sector of Sri Lanka has become the fourth-largest export earner. ICT's export earnings grew 500 percent from $166 million in 2006 to $900 million in 2016. The sector now employs over 85,000.”
(COLOMBO, July 12, 2017)