Remarks by Hon. Neomal Perera
Rt. Hon. Prime Minister of Nepal His Excellency Madhav Kumar Nepal,
Hon. Ministers,
Distinguished Members of the Head Table,
Excellencies,
Dr. Sheel Kanta Sharma, Secretary General of SAARC,
Distinguish Invitees,
Ladies and Gentlemen,
I consider that my participation at the 3rd South Asia Economic Summit is a rare privilege availed to me by the organizers. At the outset, I wish to extend my sincere thanks for the warm hospitality extended to me for my stay in this beautiful city of Katmandu.
Sri Lanka and Nepal enjoy historically deep rooted bilateral relations at every level; and in this context, I wish to refer to the growing people-to- people contacts between our two countries. These contacts are rapidly evolving as large numbers of Sri Lankans visit the birth place of the Buddha, Lumbini, and many Nepalis visit Sri Lanka as tourists.
The theme of the 3rd South Asia Economic Summit is, in my opinion, timely and appropriate. Our regional organization, South Asian Association for Regional Cooperation (SAARC) stands to ensure the Regional Economic integration in South Asia. SAARC, during its 25 years of existence, has laid the foundation towards regional integration. The signing of the SAPTA, signing of the Framework Agreement on SAFTA, and the signing of the South Asia Trade in Services (SATIS) Agreement are the three important milestones in this regard.
South Asian economies have achieved impressive rates of economic growth since the 1980s, reaching an unprecedented growth, averaging close to 6 to 7 per cent per year since the 1990s for South Asia as a whole. Yet, the region is the least integrated region of the World, whether integration is measured by intra-regional trade in goods, capital, or labour. While trade within South Asia has improved with time, it still remains low and intra-regional trade has failed to rise beyond 6 per cent of South Asia’s total trade despite the existence of SAPTA amongst the member States since 1995 and SAFTA since 2006. Intra-regional trade is less than 1 per cent of GDP, compared to more than 20 per cent in East Asia.
South Asia needs to integrate economically, if the region is to develop and advance itself similar to her neighbours in South East and Far East Asia, in particular. Historically, nations around the world have developed and advanced in blocs or regions and seldom in isolation. It is also interesting to note that when nations are committed and engaged in dynamics of economics and business to a great extent, they would diminish and dilute any other differences. It is also often stated that economics would not take place in a political vacuum and vice versa.
Economic integration in South Asia is indispensable not only for advancement but also to establish a sense of stability and predictability. I may also add that given the degree of poverty in the region, economic integration in South Asia could be a powerful and compelling instrument to lift the underprivileged from the shackles of poverty. Further, the economic integration could integrate a large percentage, which is approximately 64 percent of the populace who dwell in villages in South Asia, to the economic mainstream, thus extending dividends of economic integration.
The second track activities of South Asia can make a positive impact on the SAARC process. An Economic Summit where leading economic thinkers in South Asia interact with the private sector and government officials in the region can provide new ideas for deepening economic integration in the region. The 16th SAARC Summit declaration has given priority to deepening economic integration in the region. It is hoped that the 3rd South Asia Economic Summit will come out with innovative suggestions for the implementation of SAARC policy to support the deepening of economic integration in the region.
Distinguished Delegates, Ladies and Gentlemen,
Let me speak a few words about my country which has emerged out of nearly three decades of conflict and war, where some lessons could be drawn to the current discourse.
Sri Lanka has been able to sustain a growth rate of 5 percent during the time of the war and a growth rate of 7 to 8 percent during the post-war period. We have been able to contain the inflation at the rate of 5-6 percent, while poverty has been reduced from 15 percent to 7.8 percent. Our foreign reserves stand at US$7 billion, adequate to finance 6 months of imports while the per capita income has reached US$2140. These achievements are, by all means, remarkable for a country like Sri Lanka, which, for the last 30 years, had to dedicate precious resources to eradicate the menus of terrorism.
In terms of Millennium Development Goals, I am happy to state that Sri Lanka will be able to meet some of the targets well before 2015. This includes the universal primary education, reduction of child motility, gender equality and women empowerment and environmental sustainability.
My President, His Excellency Mahinda Rajapaksa, believes that the economic revival need to be undertaken with domestic generated growth and externally induced growth. In regard to the latter, Sri Lanka attaches great importance to integration within the region and thus SAARC is an important framework for our overall development strategy.
Distinguished Delegates, Ladies and Gentlemen,
I have seen the programme for the 3rd South Asia Economic Summit which covers wide areas of economic integration like transport, energy, and so on, and also areas that are posing a challenge to South Asia such as food insecurity and climate change. Let me briefly touch on two of the topics, namely, food insecurity and climate change.
Food insecurity is not a new phenomenon for us in South Asia. One-fifth of the humanity lives in South Asia. It is our collective responsibility to ensure that adequate food security is maintained at all levels, including access to food at a reasonable price. It is important to recall that the green revolution of 1960s had tremendous impact in the countries of South Asia. However, the increase of population, urbanization and soil degradation have resulted in less land area been available for cultivation. We need to increase the per capita food productivity of all crops. This is why the Colombo Summit in 2008 endorsed the Declaration on Food Security. In this context, I believe the application of latest technologies, including biotechnology and nano-technology could provide necessary wherewithal in ensuring increased crop productivity.
Climate change is another topic that is addressed in this Summit. I am happy to note that Sri Lanka as the Chairman of SAARC during the Climate Change Summit in Copenhagen last December, spoke on behalf of all SAARC countries with one voice, expressing our deep concerns on climate change issues. The climate changes occurring in the region will have definite impact on crop productivity, which in turn will adversely affect food security. Already we have seen abrupt weather patterns with unusual rains, coastal erosions, and melting of glaciers in the South Asian region. We should address all these challenges collectively.
I take this opportunity to acknowledge the role played by South Asia Watch on Trade, Economics and Environment in Nepal, South Asia Centre for Policy Studies, Institute of Policy Studies of Sri Lanka, Centre for Policy Dialogue of Bangladesh, and Research and Information System for Developing Countries in India in organizing this Summit with the sponsorship of a number of multilateral institutions. Events of this nature and scale can educate and edify the leaders of South Asia as well as corporate and public sector to extend greater focus and place more importance on economic integration of the region. Therefore, I congratulate you once again in your worthy exercise of holding the 3rd Asia Economic Summit here in Kathmandu.
I wish your deliberations all success. I thank you.