ACCA Sri Lanka recently held an interesting discussion on this topic that sought to explore how this initiative will reshape global trade, transform businesses and the implications it will have for Sri Lanka
The event included high profile experts comprising of Professor Li Xiguang, from the Tsinghua University International Center for Communication, Suren Rajakarier, Partner, KPMG & Vice Chairman of ACCA member network panel, Mr. Rajendra Theagarajah – Chairman Ceylon Chamber of Commerce & Managing Director of Cargills Bank , Dr Zhao Ying, Associate Director, China Sri Lanka Cooperation Studies Centre of Pathfinder Foundation and Kelvin Tan – Regional Sales Director, South East Asia, CHEC Port City Colombo (Pvt) Ltd.
A vision for the globalization of trade: Professor Li Xiguan, outlining key visions of this venture, said it is about building “a road of peace, prosperity, that connects different civilization,” and in giving priority to major investment and foreign aid projects, lead as flagship projects, that will deliver positive socioeconomic impacts, whilst also working to promote the liberalization and facilitation of trade and investment along the Belt and Road.
Reviving the Silk Road: He explained that although the initiative was proposed by China, participation of other countries along the proposed routes and related countries was indispensable to its implementation. Hence the “One Belt and One Road” consists of the Silk Road Economic Belt which connects China with Central Asia, the Arabian Gulf and Europe via land, and the Maritime Silk Road, connecting China with South East Asian countries and West Africa. This initiative he emphasized, would serve to enhance economic interconnectivity and facilitate development across Eurasia, East Africa and more than 60 partner countries. “It is a joint effort to build each of the partner country’s comparative strengths, where economic complementarity can be better transformed into new drivers of development and envisions a world of new economic growth, where win-win strategies are favored.”
Significance of the BRI initiative: Adding to these comments, Suren Rajakarier spoke on the ACCA research report on the Belt and Road initiative. He explained the strategic implication of five key priorities for coordination.These consisted firstly of policy coordination and in promoting intergovernmental cooperation,secondly financial integration that promoted systems for monetary stability, investment ,financing and credit construction across Asia and thirdly of connecting infrastructure. The fourth and fifth components comprised of unimpeded trade that removed barriers of investment, and on promoting the spirit of friendship along the silkroad to carryout extensive cultural, academic and talent exchanges.
He stated that the initiative was “not about just exports to China but takes into account that countries along the B&R have their own unique and valuable resources, which are highly complementary to one another and creates vast potential for cooperation. It encourages countries to jointly collaborate, share and exchange to a larger, higher and deeper content in an equal and mutually beneficial way. This can be considered a major innovation in international cooperation.”
Rajakarier also presented findings from a local survey carried out jointly with KPMG on the awareness level and how the benefits of BRI will impact Sri Lanka. The survey identified there was greater need for awareness among Sri Lankan corporates as only 38% believed BRI to be a boardroom discussion within the next 5 years. However, 52% of the respondents had plans to scale up capacity to meet growing demands.
The presentations were followed by a panel discussion. Panelists included Professor Li Xiguang, Mr. SurenRajakarier, Mr. Rajendra Theagarajah, Dr Zhao Ying and Mr.Kelvin Tan.
The panel’s opinion was that with China emerging as one of Sri Lanka’s top five investors and Sri Lanka’s strategic position in the middle of the maritime Silk Road, the initiative offered the opportunity of promoting the country as a trading hub in the Indian Ocean. They felt that it could further improve trade and investment linkages with China and other partner countries including East Asia and Europe, that can be translated into concrete outcomes for the country in the future.