A Critical Review on the Foreign Trade Policy, Export Potential amidst COVID-19; The Role of Institutions and Policy Reforms Required in Sri Lanka

Abstract

The global economy is heavily impacted by the ongoing calamity, COVID-19. The pandemic impacts the global economy both directly and indirectly and its consequences on the economy will last for a long period of time. Given that, it will exacerbate the critical position of Sri Lanka, being a country, whose trade policy has not been sound and engaging in a continuous struggle over the years to create sustainable foreign trade policy. This paper examines the impact of COVID-19 on the Sri Lankan economy with a special reference to foreign trade policy. This study is primarily based on a review of secondary data and literature. This paper critically reviews and analyses the foreign trade policy of Sri Lanka since the time the country became an open economy. In doing so, it mainly identifies the factors which have led to poor export performance, the untapped export potential of the country and the opportunities COVID-19 has given to rethink and reform in terms of foreign trade policy.