According to the World Bank’s latest report, Sri Lanka’s economic growth rate is expected to reach 3.5% this year, matching the October forecast. However, the challenges posed by high US tariffs and persistent poverty cannot be overlooked.
President Dissanayake emphasized that the government has taken measures to minimize the impact of US tariffs on Sri Lanka’s economy. Strengthening the economy to withstand any global economic storm remains a top priority for the administration.
Due to disparities in economic development, the US tariff policy is expected to widen the gap between rich and poor countries, with less developed nations like Sri Lanka bearing the brunt. The country’s already fragile economy is under additional strain, particularly its vital export sector.
The garment industry, Sri Lanka’s second-largest source of foreign exchange, has faced a sharp drop in orders and revenue, with export values potentially falling by 20%. This decline threatens tens of thousands of jobs and has already triggered labor disputes and widespread factory shutdowns after garment factories canceled traditional New Year bonuses.
Other export sectors, such as rubber, plastic products, tea, and gems, are also at risk of negative impacts. As exports decline, Sri Lanka’s foreign exchange earnings shrink, the rupee depreciates, import costs rise, and inflation worsens—posing a threat to macroeconomic stability and foreign debt repayment, thereby slowing economic growth.
Globally, the United States has used tariffs as a tool to exert pressure for its own gain, undermining the international economic order and multilateral trade systems under the pretext of protecting domestic industries and ensuring supply chain security. In reality, this approach politicizes trade and creates severe challenges for multilateralism and global economic recovery.
Historically, similar tactics were seen in the early 1950s when the US imposed blockades that harmed newly founded China and its trading partners like Ceylon (Sri Lanka). Despite these barriers, China and Ceylon established strong ties through the historic Rubber-Rice Pact, even as the US retaliated by cutting off aid and essential supplies.
Today, the United States is again placing its interests above global needs, provoking new trade conflicts. China has responded firmly, asserting its readiness to defend its rights if necessary while remaining open to dialogue.
China’s opposition to US unilateralism is rooted in the belief that compromise with bullying only leads to greater losses. China’s stance aims not only to protect its own interests but also to uphold the rights of developing countries and defend global fairness and justice.
Economic globalization remains an unstoppable force, and multilateralism is essential for addressing global challenges. China continues to contribute significantly to global growth, uphold multilateral trade rules, and promote broader development opportunities.
Throughout changing times, the friendship between China and Sri Lanka has endured. Chinese investments in ports, highways, healthcare, and other sectors have significantly boosted Sri Lanka’s infrastructure and economic growth. Landmark projects like the Colombo Port City and Hambantota Port are key symbols of this cooperation under the Belt and Road Initiative.
President Dissanayake’s visit to China earlier this year marked a milestone in strengthening ties. During the visit, both nations agreed to expand cooperation in trade, agriculture, climate change, and education, and jointly build a China-Sri Lanka community of shared destiny.
As the United States escalates trade tensions through tariffs, China has pledged continued support for Sri Lanka’s development and resilience.
China and Sri Lanka’s partnership exemplifies successful South-South cooperation, based on mutual respect, shared benefits, and sustainable development. Justice will ultimately prevail over injustice, and by standing united, both countries can achieve greater stability and prosperity.
At a time when the world faces turbulence and rising protectionism, China and Sri Lanka must work together to safeguard peace, promote development, and resist divisive geopolitical forces. Building a China-Sri Lanka community of shared future will contribute to global stability and a brighter, more certain future.
