By AP and published by Yahoo!News
Colombo, Sri Lanka – Thai Prime Minister Srettha Thavisin was the guest of honour at Sri Lanka’s 76th Independence Day celebrations on Sunday (Feb. 4), as the island nation struggles to emerge from its worst economic crisis.
Srettha joined Sri Lankan President Ranil Wickremesinghe at a low-key ceremony near the country’s main seaside esplanade that included a military parade and parachute jumps. The holiday commemorates Sri Lanka’s independence from British rule in 1948.
Sri Lanka declared bankruptcy in April 2022 with more than $83 billion in debt, more than half of it to foreign creditors. The economic upheaval led to a political crisis that forced then-President Gotabaya Rajapaksa to resign in 2022. The parliament then elected Wickremesinghe as president.
Srettha arrived in Sri Lanka on Saturday and the two countries signed a free trade agreement aiming to boost trade and investment.
The Sri Lanka Thailand Free Trade Agreement covering trade in goods, investment, custom procedures and intellectual property rights was signed in the capital Colombo in the presence of Sri Lanka President Ranil Wickremesinghe and Thai Prime Minister Srettha.
Sri Lanka began talks with Thailand on a free trade agreement in 2016.
The countries’ two-way trade was worth about $352 million in 2022, with Thailand’s exports at $292 million and Sri Lanka’s exports at $58 million, according to Sri Lankan government’s data.
Sri Lanka exports include mainly precious stones, apparel, tea and spices while exports from Thailand include smoked rubber sheets, natural rubber, plastic and cement. Sri Lanka’s government expects the trade pact would boost two-way trade up to $1.5 billion.
Srettha said that the countries agreed to promote investment in areas such as fisheries, food processing, tourism and green energy. Thailand has made over $92 million in direct investment in Sri Lanka from 2005 to 2022.
Giving further boost to tourism, Srettha said that Thailand’s flag carrier Thai Airways would resume daily flights from Bangkok to Sri Lanka next month.
Wickremesinghe said on Saturday that Sri Lanka has made significant progress in economic stabilisation and sought the help of Thailand in efforts to transform the battered economy and regain international confidence.
Sri Lanka suspended repayment of its debt in 2022 as it ran short of foreign currency needed to pay for imports of fuel and other essentials. Shortages led to street protests that changed the country’s leadership. The International Monetary Fund approved a four-year bailout programme last March.
The economic situation has improved under Wickremesinghe, and severe shortages of food, fuel and medicine have largely abated. But public dissatisfaction has grown over the government’s effort to increase revenue by raising electricity bills and imposing heavy new income taxes on professionals and businesses, as part of the government’s efforts to meet the IMF conditions.
Sri Lanka is hoping to restructure $17 billion of its outstanding debt and has already reached agreements with some of its external creditors.
CAPTIONS:
Top: In this handout photograph released by the Sri Lanka President’s Office HO, Sri Lankan President Ranil Wickremesinghe, right, receives Thai Prime Minister Srettha Thavisin at the presidential secretariat in Colombo, Sri Lanka, on Saturday, Feb. 3, 2024. Photo: Sri Lanka President’s Office HO via AP and published by Yahoo!News
First below: Thai Prime Minister Srettha Thavisin, centre, sits with Sri Lankan Prime Minister Dinesh Gunawaradane, left, and the First Lady of Sri Lanka Maithree Wickremesinghe, during the 76th Independence Day commemoration ceremony of Sri Lanka in Colombo, Sri Lanka, on Sunday, Feb. 4, 2024. Photo: AP/Eranga Jayawardena and published by Yahoo!News
Second below: In this handout photograph released by the Sri Lanka President’s Office HO, Sri Lankan President Ranil Wickremesinghe, second right, poses for a photograph with Thai Prime Minister Srettha Thavisin at the presidential secretariat in Colombo, Sri Lanka, on Saturday, Feb. 3, 2024. Photo: Sri Lanka President’s Office HO via AP and published by Yahoo!News
Front Page: Thai Prime Minister Srettha Thavisin, second right, stands with Sri Lankan Prime Minister Dinesh Gunawaradane, second left, and the First Lady of Sri Lanka Maithree Wickremesinghe, right, as they observe a minute’s silence in honour of Sri Lankan heroes during the 76th Independence Day commemoration ceremony of Sri Lanka in Colombo, Sri Lanka, on Sunday, Feb. 4, 2024. Photo: AP Photo/Eranga Jayawardena and published by Yahoo!News
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