SAARC needs to increase regional cooperation or we will be left behind – Ranil
ECONOMYNEXT – Sri Lanka’s former Prime Minister is warning countries in the South Asian region that they need to push regional cooperation hard or be left behind by the rest of the world.
Ranil Wickremesinghe, delivering the keynote address on the second day of a “thought conclave” hosted by the Hindu Newspaper said that the progress made by the South Asian Association of Regional Cooperation (SAARC) was dismal compared to similar organisations in other parts of Asia.
He pointed out that South Asia has less than 1% of the net worth of the world’s total production of exports while South-East Asia has 8%.
“You will agree that 1% is a figure that is not sufficient to sustain South Asian economic growth,” he said.
He said that in a few years this region will have “150 million young people entering the job market every year.” Therefore the governments of the region need to have a robust plan to deal with that challenge.
In 1997, India and Thailand took the initiative to form BIMSTEC – the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation.
But Wickremesinghe pointed out that BIMSTEC has “neither a clear vision nor actionable goals.” It took 10 years after the first summit to establish the BIMSTEC Secretariat, which is still underfunded. The BIMSTEC trade record on Economic Integration is also insignificant. An agreement in 2004 to conclude an FTA by 2006 is still pending, he said.
On the other hand, South East Asia started a slow but successful march towards regional integration – starting with ASEAN – The Association of South-East Asian Nations. The ASEAN Free Trade Area was established in 1992. The ultimate goal is an ASEAN Economic Community.
“Unfortunately for us, South Asia remains the least economically-assimilated region in Asia. And it faces a dilemma: to be connected or to be left out of these new and expanding Asia Pacific configurations of productivity and trade,” Wickremesinghe said.
The former Prime Minister bemoaned the fact that rising tensions between India and Pakistan is preventing SAARC summits from taking place. These tensions have also contributed to the perception that our region is a nuclear zone, pointed out.
He said that historically the region had a highly developed trade network. He cited the example of the network developed by the Nattukottai Chettiars which spanned Sri Lanka, Myanmar, Thailand, Malaysia, Singapore, and South Vietnam until the mid- 20th Century.
“They had over 1500 businesses in Myanmar before World War II. The integrated financial network of the Nattukottai Chettiars has yet to be matched in the ASEAN and the BIMSTEC countries” Wickremesinghe said. (Colombo February 24, 2020)