The 4th LKI Foreign Policy Forum, which highlighted the outcome of Sri Lanka’s debt restructuring and its impact on economic diplomacy and foreign policy, was held last week at the Lighthouse Auditorium of the Lakshman Kadirgamar Institute of International Relations and Strategic Studies (LKI).

Sri Lanka’s imperative need to enact growth-oriented reforms particularly in governance, build consensus among all political parties on the reforms implemented and a foreign policy that leverages economic diplomacy, as well as modalities for sustained economic growth was emphasised.

The forum was moderated by Executive Director of LKI Ambassador Ravinatha Aryasinha, and the four-member panel included Visiting Senior Fellow of the Overseas Development Institute Dr. Ganeshan Wignaraja, Ceylon Chamber of Commerce Chairperson Duminda Hulangamuwa, Economist and Expert Member of the World Economic Forum Talal Rafi, and Research Director of Verité Research Subhashini Abeysinghe.

Addressing the forum, Dr. Wignaraja cautioned that Sri Lanka’s economic recovery is taking place in an era of uncertainty as the world enters a stage of geo-economic fragmentation. He stressed that the key to transformative growth lies in looking beyond the IMF programme and re-tuning for growth-oriented reforms within Sri Lanka. He warned that although successfully surviving the worst economic crisis in the country’s history, Sri Lanka’s economy remains fragile, and complete recovery demands that Sri Lanka reach consensus on a long-term reform agenda. He added that foreign policy will play a critical role in Sri Lanka’s economic recovery and emphasised the need to be “extremely surgical about our national interests and economic security”.

Abeysinghe pointed out that economic reforms cannot succeed without reforms in governance, and further that infrastructure development alone is not enough to achieve the growth Sri Lanka aspires for, and that institutional and regulatory reforms are crucial. She also called for a shift in attitudes, particularly towards foreign investment that requires international talent and investment, noting that Sri Lanka cannot afford to look at the world as a threat and must take hold of opportunities available through partnerships. 

The importance of Sri Lanka maintaining a levelled ‘playing field’ and being even-handed in its engagements in economic diplomacy and foreign policy was emphasised during the forum.