COLOMBO: Sri Lanka said its trade would be hurt by the United Kingdom’s “nightmare” vote to leave the European Union, with $1 billion in annual exports to the British market now clouded by uncertainty.
The South Asian nation famed for its tea and spices is on the brink of signing up to a scheme with the European Union that would grant it lower tariffs on many goods.
But with Britain its largest EU export market, the shock Brexit vote will make things tougher for the cash-strapped island, likely leading to new restrictions.
“We knew it was going to be a nightmare,” Deputy Foreign Minister Harsha de Silva said.
The dramatic fall in sterling is likely to inflict extra pain on Sri Lanka’s exporters, the minister added.
De Silva and colleagues had travelled to London last week to urge voters of Sri Lankan origin to support the “remain” campaign.
Britain is Sri Lanka’s second biggest export market after the United States, accounting for about 10 percent of outbound goods.
De Silva said Colombo would now look to fast-track separate free trade agreements with China and India to counter the damage.
The government hopes to finalise a free-trade deal with Singapore within a month and is discussing similar agreements with Japan and South Korea.
Sri Lanka this month received the first tranche of a $1.5 billion bailout loan from the International Monetary Fund.
