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Asian countries Singapore and Sri Lanka have begun negotiations on a free trade deal, inclusive of processes to free up trade in goods, services and investments, said Singapore’s Ministry of Trade and Industry (MTI).

Minister for Trade Industry, S. Iswaran, and his counterpart, Minister for Development Strategies and International Trade Malik Samarawickrama, signed a joint statement to officially to launch the Sri Lanka-Singapore Free Trade Agreement (SLSFTA).

“The launch of the SLSFTA negotiations signals the commitment of both government to promote stronger economic ties and enhance trade flows by lowering barriers of entry and providing increased market access for Singapore and Sri Lankan companies.” Iswaran said.

Iswaran added that amid an uncertain economic environment, Sri Lanka bears a great potential for Singaporean firms searching for opportunities in new markets.

Singapore Prime Minister Lee Hsien Loong and Sri Lanka Prime Minister Ranil Wickremesinghe witnessed the signing.

New Investments, Opportunities

Iswaran said that there is demand for new and enhanced infrastructure across South Asia in his speech at the South Asian Convention 2016 on July 10, Sunday.

The minister further said that bilateral investment treaties are set to generate more investment opportunities in the region, even while Singapore companies like Sembcorp and Prima Group have already built inroads by investing in India and Sri Lanka.

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For instance, the avoidance of double taxation agreements with South Asian partners serve to make investing in South Asia more attractive to investors in Sinapore, he added.

"This network of economic connectivity agreements are an important foundation on which we can build the activities— not just on the infrastructure, but also deepening economic activity between Singapore and South Asia.”  He said.

Sri Lanka’s drive to make infrastructure and develop its industries displayed possibilities for Singapore companies to tie up with Sri Lanka firms and add to its progress.

Sri Lanka, the Indian Ocean Island, was Singapore’s 39th biggest trading partner last year.The MTI said the bilateral trade between the two nations was S$2.05 billion in 2015, with local exports tallying S$1.9 billion that year, while Singapore's imports amounted to S$146 million.

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