Sri Lanka's Deputy Secretary to Treasury S.R. Attygalle announced on Tuesday that a proposed Free Trade Agreement (FTA) between the South Asian country and China will be signed in June 2015.
The FTA is projected to contribute to Sri Lanka's future development and further strengthen the trade relations between the two countries, according to state-based Xinhua News Agency.
Sri Lankan President Mahinda Rajapaksa, who announced on Friday the same time frame for the signing of the agreement, talked about the planned FTA dialogue: "Our cooperation covers many sectors, including industry, energy, technology, infrastructure and tourism."
The president said that the agreement will also boost Sri Lanka's export to China, which will mean new economic opportunities to the country. The country's export products are mainly coir fiber, garments, tea, rubber and precious stones.
Meanwhile, Chinese President Xi Jinping's state visit to Sri Lanka in September has helped foster deeper cooperation and bolster the economic relationship between the two countries, according to a Xinhua report. Xi's visit was the first in 28 years by a Chinese head of state.
When President Rajapaksa visited China in May 2013, the two leaders agreed to raise the bilateral relations between the two countries to a "strategic cooperation partnership," which they planned to achieve by significantly enhancing the mandate for engagement.
Sri Lanka's exports to China have improved from $28.39 million in 2005 to $121.63 in 2013. However, China is still at an advantage in terms of trade balance.
With the FTA, Sri Lanka hopes to enter the Chinese market with greater ease and eventually decrease its trade deficit toward China, which is the world's second largest economy.