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Sri Lanka Seeks Strategic Partnership with Saudi Arabia, Activation of 10 Bilateral Agreements

Omar Lebbe Ameer Ajwad, Sri Lanka’s Ambassador to Saudi Arabia (Asharq Al-Awsat)
Omar Lebbe Ameer Ajwad, Sri Lanka’s Ambassador to Saudi Arabia (Asharq Al-Awsat)
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Sri Lanka Seeks Strategic Partnership with Saudi Arabia, Activation of 10 Bilateral Agreements

Omar Lebbe Ameer Ajwad, Sri Lanka’s Ambassador to Saudi Arabia (Asharq Al-Awsat)
Omar Lebbe Ameer Ajwad, Sri Lanka’s Ambassador to Saudi Arabia (Asharq Al-Awsat)

Sri Lanka’s Ambassador to Saudi Arabia Omar Lebbe Ameer Ajwad revealed ongoing efforts to establish a strategic partnership with Saudi Arabia and implement 10 signed agreements across various sectors to foster mutual growth.

Such efforts also aim to launch collaborations in projects aligned with Saudi Vision 2030, with hopes of boosting bilateral trade and investments in technology and agriculture.

The diplomat highlighted that the inaugural session of the joint committee between the two countries, held in 2023, identified 63 areas of cooperation spanning 20 sectors, including the economy, science, defense, technology, culture, youth, and sports.

He noted that Saudi Arabia has been a long-standing development partner for Sri Lanka. Over the years, the Saudi Fund for Development has extended $438 million (1.5 billion SAR) in concessional loans, financing 15 development projects in the country.

Among these projects are the Colombo Water Supply and Sewerage Project (1981), Kinniya Bridge—the longest in Sri Lanka, the Neurotrauma Unit at Colombo National Hospital, the Kalu Ganga Development Project, the Medical Faculty at Sabaragamuwa University, the Wayamba University Township, and the Peradeniya-Badulla-Chenkaladi Road.

Ajwad stated that Sri Lanka and Saudi Arabia have so far signed 10 bilateral agreements and memorandums of understanding (MoUs) in addition to other agreements under consideration. These cover aviation services, customs duties, workforce, economy, trade, investment, technology, culture, skills verification, youth and sports, political consultations, avoidance of double taxation, and foreign direct investment.

With the implementation of Vision 2030, Ajwad emphasized that bilateral relations are entering a new phase, particularly in 2024 as the two countries celebrate 50 years of diplomatic ties. He noted that collaboration opportunities include the Colombo Port City Special Economic Zone, tourism and hospitality, agriculture and food security, renewable energy, and information and communications technology (ICT).

The official further mentioned that Saudi Arabia is Sri Lanka’s 24th largest export market and 11th largest source of imports, with plans to expand economic cooperation in trade and investment. In 2023, Sri Lanka exported goods worth $99.9 million to Saudi Arabia, while imports from the Kingdom amounted to $288.84 million.

Key Sri Lankan exports include tea, rubber products, fruits and vegetables, frozen fish, coconut products, and cloves. Imports from Saudi Arabia primarily consist of petroleum oils, liquefied petroleum gases, fertilizers, chemicals, and plastic products.

Ajwad also highlighted potential value-added exports to Saudi Arabia, such as spices, tea, kithul products, coconut-based goods, fresh produce, processed foods, organic agricultural products, and seafood. Sri Lanka’s industrial exports to Saudi Arabia include rubber products, gemstones, jewelry, apparel, ceramics, and porcelain.

He noted that Sri Lankan companies have also invested in Saudi Arabia, including Sierra Construction, which operates in the electromechanical sector.

The ambassador said that Saudi Arabia’s Minister of Economy and Planning, Faisal bin Fadhil Alibrahim, discussed creating an economic roadmap during his recent visit to Sri Lanka, which covers trade, investment, energy, tourism, cultural exchange, digital transformation, and employment opportunities.

In the second half of 2024, Sri Lankan companies participated in major international exhibitions in Saudi Arabia, including the Riyadh Travel Fair 2024, Saudi Food Expo 2024, Saudi Agriculture Exhibition 2024, the Saudi Workforce Exhibition, and the Saudi International Handicrafts Exhibition (Banan).

Ajwad emphasized that bilateral relations have seen significant growth since the establishment of diplomatic ties in 1974. Sri Lanka opened its first embassy in Jeddah in 1983, which was later relocated to Riyadh in 1985. Saudi Arabia established its first resident embassy in Colombo in 1996 and appointed its first ambassador in 2001.

Since the 1980s, many Sri Lankans have traveled to Saudi Arabia for work. Today, an estimated 200,000 Sri Lankans reside in the Kingdom. At the same time, Sri Lanka has become a preferred travel destination for Saudi tourists.

The diplomat stressed that the two countries have maintained strong ties at bilateral, regional, and multilateral levels. They cooperate in organizations such as the Non-Aligned Movement (NAM), the Indian Ocean Rim Association (IORA), the Asian Cooperation Dialogue (ACD), the ASEAN Regional Forum (ARF), and various United Nations bodies.

In 2024, Sri Lanka and Saudi Arabia will celebrate 50 years of diplomatic relations—a significant milestone reflecting the depth of their friendship and strategic partnership. The economic ties between the two nations trace back centuries to trade in goods such as pearls, gemstones, sandalwood, cloves, cinnamon, pepper, coconuts, and ivory.

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IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
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IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA

The International Monetary Fund (IMF) and the Arab Monetary Fund (AMF) signed a memorandum of understanding (MoU) on the sidelines of the AlUla Conference on Emerging Market Economies (EME) to enhance cooperation between the two institutions.

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki, SPA reported.

The agreement aims to strengthen coordination in economic and financial policy areas, including surveillance and lending activities, data and analytical exchange, capacity building, and the provision of technical assistance, in support of regional financial and economic stability.

Both sides affirmed that the MoU represents an important step toward deepening their strategic partnership and strengthening the regional financial safety net, serving member countries and enhancing their ability to address economic challenges.

Business

Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT
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Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT

The Federation of Saudi Chambers announced the formation of the first joint Saudi-Kuwaiti Business Council for its inaugural term (1447–1451 AH) and the election of Salman bin Hassan Al-Oqayel as its chairman.

Al-Oqayel said the council’s formation marks a pivotal milestone in economic relations between Saudi Arabia and Kuwait, reflecting a practical approach to enabling the business sectors in both countries to capitalize on promising investment opportunities and strengthen bilateral trade and investment partnerships, SPA reported.

He noted that trade between Saudi Arabia and Kuwait reached approximately SAR9.5 billion by the end of November 2025, including SAR8 billion in Saudi exports and SAR1.5 billion in Kuwaiti imports.

Business

Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
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Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).

Harvard University economics professor Pol Antràs said Saudi Arabia represents an exceptional model in the shifting global trade landscape, differing fundamentally from traditional emerging-market frameworks. He also stressed that globalization has not ended but has instead re-formed into what he describes as fragmented integration.

Speaking to Asharq Al-Awsat on the sidelines of the AlUla Conference for Emerging Market Economies, Antràs said Saudi Arabia’s Vision-driven structural reforms position the Kingdom to benefit from the ongoing phase of fragmented integration, adding that the country’s strategic focus on logistics transformation and artificial intelligence constitutes a key engine for sustainable growth that extends beyond the volatility of global crises.

Antràs, the Robert G. Ory Professor of Economics at Harvard University, is one of the leading contemporary theorists of international trade. His research, which reshaped understanding of global value chains, focuses on how firms organize cross-border production and how regulation and technological change influence global trade flows and corporate decision-making.

He said conventional classifications of economies often obscure important structural differences, noting that the term emerging markets groups together countries with widely divergent industrial bases. Economies that depend heavily on manufacturing exports rely critically on market access and trade integration and therefore face stronger competitive pressures from Chinese exports that are increasingly shifting toward alternative markets.

Saudi Arabia, by contrast, exports extensively while facing limited direct competition from China in its primary export commodity, a situation that creates a strategic opportunity. The current environment allows the Kingdom to obtain imports from China at lower cost and access a broader range of goods that previously flowed largely toward the United States market.

Addressing how emerging economies should respond to dumping pressures and rising competition, Antràs said countries should minimize protectionist tendencies and instead position themselves as committed participants in the multilateral trading system, allowing foreign producers to access domestic markets while encouraging domestic firms to expand internationally.

He noted that although Chinese dumping presents concerns for countries with manufacturing sectors that compete directly with Chinese production, the risk is lower for Saudi Arabia because it does not maintain a large manufacturing base that overlaps directly with Chinese exports. Lower-cost imports could benefit Saudi consumers, while targeted policy tools such as credit programs, subsidies, and support for firms seeking to redesign and upgrade business models represent more effective responses than broad protectionist measures.

Globalization has not ended

Antràs said globalization continues but through more complex structures, with trade agreements increasingly negotiated through diverse arrangements rather than relying primarily on multilateral negotiations. Trade deals will continue to be concluded, but they are likely to become more complex, with uncertainty remaining a defining feature of the global trading environment.

Interest rates and artificial intelligence

According to Antràs, high global interest rates, combined with the additional risk premiums faced by emerging markets, are constraining investment, particularly in sectors that require export financing, capital expenditure, and continuous quality upgrading.

However, he noted that elevated interest rates partly reflect expectations of stronger long-term growth driven by artificial intelligence and broader technological transformation.

He also said if those growth expectations materialize, productivity gains could enable small and medium-sized enterprises to forecast demand more accurately and identify previously untapped markets, partially offsetting the negative effects of higher borrowing costs.

Employment concerns and the role of government

The Harvard professor warned that labor markets face a dual challenge stemming from intensified Chinese export competition and accelerating job automation driven by artificial intelligence, developments that could lead to significant disruptions, particularly among younger workers. He said governments must adopt proactive strategies requiring substantial fiscal resources to mitigate near-term labor-market shocks.

According to Antràs, productivity growth remains the central condition for success: if new technologies deliver the anticipated productivity gains, governments will gain the fiscal space needed to compensate affected groups and retrain the workforce, achieving a balance between addressing short-term disruptions and investing in long-term strategic gains.