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Sri Lanka's Trade Policy: Reverting to Dirigisme?

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  • Prema-chandra Athukorala

Abstract

This paper surveys recent development in Sri Lankan trade policy, with an emphasis on emerging protectionist tendencies, using Sri Lanka’s Trade Policy Review (2010) by the World Trade Organization as a reference point. The Sri Lankan experience for over the three decades following the liberalization reforms started in 1977 has clearly demonstrated that an outward-oriented policy regime can yield a superior development outcome compared to a closed-economy regime, even under severe strains of a protracted ethnic conflict and macroeconomic instability. Viewed against this back drop, recent developments in the Sri Lankan policy scene do not seem to augur well for the future of the Sri Lankan economy.

Suggested Citation

  • Prema-chandra Athukorala, 2012. "Sri Lanka's Trade Policy: Reverting to Dirigisme?," Departmental Working Papers 2012-14, The Australian National University, Arndt-Corden Department of Economics.
    • Handle: RePEc:pas:papers:2012-14
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    References listed on IDEAS

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    1. World Bank, 2004. "Sri Lanka : Development Policy Review," World Bank Publications - Reports 14577, The World Bank Group.
    2. Sirimal Abeyratne, 2004. "Economic Roots of Political Conflict: The Case of Sri Lanka," The World Economy, Wiley Blackwell, vol. 27(8), pages 1295-1314, August.
    3. Roemer, Michael, 1979. "Resource-based industrialization in the developing countries : A survey," Journal of Development Economics, Elsevier, vol. 6(2), pages 163-202, April.
    4. Rajapatirana, Sarath, 1988. "Foreign trade and economic development: Sri Lanka's experience," World Development, Elsevier, vol. 16(10), pages 1143-1157, October.
    5. Prema-chandra Athukorala & Bambang Santosa, 1997. "Gains from Indonesian Export Growth: Do Linkages Matter?," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 33(2), pages 73-95.
    6. A. G. (Sandy) Cuthbertson, 1997. "The Trade Policy Review of Sri Lanka," The World Economy, Wiley Blackwell, vol. 20(5), pages 633-648, August.
    7. Louis T., Jr. Wells & Nancy J. Allen & Jacques Morisset & Neda Pirnia, 2001. "Using Tax Incentives to Compete for Foreign Investment : Are They Worth the Costs?," World Bank Publications - Books, The World Bank Group, number 13979.
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    Cited by:

    1. Prema-chandra Athukorala & Sisira Jayasuriya, 2015. "Victory in War and Defeat in Peace: Politics and Economics of Post-Conflict Sri Lanka," Asian Economic Papers, MIT Press, vol. 14(3), pages 22-54, Fall.
    2. Prema-chandra Athukorala & Raveen Ekanayake, 2014. "Repositioning in the Global Apparel Value Chain in the Post-MFA Era: Strategic Issues and Evidence from Sri Lanka," Departmental Working Papers 2014-17, The Australian National University, Arndt-Corden Department of Economics.
    3. Prema†chandra Athukorala & Raveen Ekanayake, 2018. "Repositioning in the global apparel value chain in the post†MFA era: Strategic issues and evidence from Sri Lanka," Development Policy Review, Overseas Development Institute, vol. 36(S1), pages 247-269, March.
    4. Biswajit Maitra, 2021. "Relative role of external debt, FDI, and domestic investment in economic growth: evidence from Sri Lanka," International Journal of Economic Policy Studies, Springer, vol. 15(2), pages 329-347, September.
    5. Liyanaarachchi, Tilak S. & Naranpanawa, Athula & Bandara, Jayatilleke S., 2016. "Impact of trade liberalisation on labour market and poverty in Sri Lanka. An integrated macro-micro modelling approach," Economic Modelling, Elsevier, vol. 59(C), pages 102-115.
    6. Rathnayake, Anuruddhi Shanika K, 2020. "Sustainability of the fiscal imbalance and public debt under fiscal policy asymmetries in Sri Lanka," Journal of Asian Economics, Elsevier, vol. 66(C).
    7. Kishor Sharma & Oyunbadam Davaakhuu, 2015. "Trade Policymaking in a Resource‐rich Landlocked Country: The WTO Review of Mongolia," The World Economy, Wiley Blackwell, vol. 38(9), pages 1350-1367, September.
    8. Liyanaarachchi, Tilak Susantha & Bandara, Layatilleke S. & Naranpanawa, Athula, 2014. "A Quantitive Evaluation of the Potential Effects of Trade Policy Reversal in Sri Lanka: A Computable General Equilibrium (CGE) Analysis," Sri Lankan Journal of Agricultural Economics, Sri Lanka Agricultural Economics Association (SAEA), vol. 16, pages 1-26, November.
    9. Sirimal Abeyratne, 2013. "Integration of Sri Lanka into Indian Supply Chains under the Bilateral Free Trade Agreement," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 14(2), pages 275-292, September.

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    More about this item

    Keywords

    Sri Lanka; trade policy; trade liberalization; World Trade Organization.;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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