📈 Sri Lanka Pursues Accession to RCEP Trade Bloc

• Strategic Scale: RCEP encompasses 15 member countries (10 ASEAN nations + Australia, China, Japan, South Korea, New Zealand), representing ~30% of global GDP, 29% of global trade, and 2.3 Bn consumers. • Export Diversification: Over 60% of Sri Lanka's merchandise exports are concentrated in the US, EU, UK, and India. Accession offers access to faster-growing regional markets to mitigate external risks. • Sectoral Impact: Preferential access and integration into regional value chains will benefit manufacturing, agriculture, services, and technology-based industries, while boosting long-term FDI. • Key Challenges: Requires aligning Sri Lanka's higher tariff and para-tariff structures, boosting institutional negotiating capacity, and supporting vulnerable domestic industries during liberalisation. • Current Progress: Sri Lanka submitted its formal Letter of Intent in June 2023, with recent encouraging signals from founding members Australia and New Zealand.