Opinion
Turning Trade Disruptions into Opportunities
The silver lining of US tariffs for emerging economies:
In a world that thrives on interconnectedness, the imposition of U.S. tariffs has been widely discussed through the lens of negativity—trade wars, disrupted supply chains, and market turbulence. However, this narrow view fails to account for the opportunities that arise from such disruptions. While it’s easy to focus on the immediate challenges—rising costs, retaliatory measures, and financial volatility—emerging economies, especially those in Asia and South Asia, are beginning to see a silver lining.
The very disruptions caused by U.S. tariffs can open up pathways for growth, innovation, and strategic realignment. Rather than being passive victims of global trade tensions, countries like Sri Lanka can leverage these moments of upheaval as catalysts for economic renewal, stronger international partnerships, and greater resilience in the face of future global shifts. The silver lining of U.S. tariffs, therefore, lies in how emerging economies can transform these challenges into lasting opportunities for economic development and regional integration.
Traditionally seen as a blunt economic tool, tariffs have made a comeback, especially during and after the Trump administration. While much attention has focused on the negative impacts of tariffs—such as trade slowdowns, retaliatory tariffs, and market volatility—this view overlooks some of the potential positive outcomes, especially in the longer term. This article will explore the opportunities created by U.S. tariffs, particularly for emerging economies like Sri Lanka.
What Are Tariffs and Why Are They Imposed?
Tariffs are taxes placed on imported goods, making them more expensive for consumers. The United States has used tariffs as a way to address trade imbalances, protect domestic industries, and assert its influence on the global stage. For example, tariffs on steel and aluminum were meant to safeguard American manufacturing jobs, while tariffs on Chinese goods were part of broader efforts to correct trade deficits with China and challenge unfair trade practices.
The Immediate Consequences
of U.S. Tariffs
When tariffs are imposed, the immediate effects are usually negative for global trade. Countries that rely on exporting to the U.S. face reduced demand for their goods, which can lead to financial losses. Markets may experience increased volatility, stock prices may drop, and inflation could rise, especially in countries dependent on global supply chains.
For instance, countries like China have retaliated with their own tariffs, leading to a “trade war” that has disrupted global supply chains. As a result, businesses face higher costs and reduced profits, which can also affect consumers who pay more for goods.
The Longer-Term Effects: Economic Reshaping
Although tariffs create challenges, they also lead to changes that could benefit certain economies in the long run. For example, trade wars often force countries to rethink their supply chains. In response to U.S. tariffs, many multinational companies started seeking alternatives to China for manufacturing. This shift, known as the “China +1” strategy, has led to countries like Sri Lanka, Vietnam, and India seeing a rise in foreign investment and a growing role in the global supply chain.
Sri Lanka, with its strategic location and competitive labor costs, has become an attractive destination for businesses looking to diversify their production outside of China. Sri Lanka’s exports, such as tea and apparel, have seen increased demand as companies move their operations to places less affected by tariffs. This shift creates opportunities for countries like Sri Lanka to boost their industrial sectors, attract foreign capital, and integrate into regional trade networks.
The Role of Financial Volatility
One of the immediate reactions to tariffs is financial volatility, as global markets try to adjust to the uncertainty caused by trade conflicts. While this often results in market instability, financial volatility can also serve as a catalyst for broader economic reforms. In times of crisis, countries may be forced to improve their fiscal policies, strengthen their institutions, and diversify their economies.
For example, countries in the emerging world may use the pressure from tariffs to undertake structural reforms that make their economies more resilient. They may improve fiscal governance, attract more investment, and create a more diversified and stable economy. Over time, this can reduce their dependence on any single trading partner and help them weather future economic shocks.
Opportunities for Emerging Economies
Although U.S. tariffs present challenges for emerging economies, especially those that depend on exports to the U.S., they also provide opportunities for strategic realignment. With companies looking for alternatives to China, emerging economies can reposition themselves as attractive investment destinations.
Sri Lanka, for instance, has benefited from this shift in the global supply chain. As businesses look for stable alternatives to Chinese manufacturing, Sri Lanka has seen an increase in demand for its exports, such as textiles and tea. Additionally, foreign direct investment (FDI) in Sri Lanka has been growing, with companies looking to set up production facilities in countries that are less affected by tariff measures.
This shift is not just about attracting investment but also about repositioning a country within regional supply chains. Sri Lanka has the potential to become a key player in the Indian Ocean region, connecting Asia with Europe and Africa. By improving infrastructure, such as ports and digital networks, Sri Lanka can better integrate into global value chains and increase its export capacity.
Sri Lanka’s Response
to Global Shifts
For Sri Lanka, the global effects of U.S. tariffs present both a challenge and an opportunity. The country is currently dealing with debt restructuring, fiscal deficits, and economic instability. However, these global disruptions can be leveraged as a platform for domestic renewal.
Sri Lanka’s response to these shifts includes diversifying its export markets. By increasing trade with other regions, such as Southeast Asia, India, and the EU, Sri Lanka can reduce its reliance on any one country or market. Regional trade agreements like the South Asian Free Trade Area (SAFTA) can help strengthen Sri Lanka’s position in the global market and protect it from the volatility of global trade wars.
Additionally, Sri Lanka has used these global shifts as an opportunity to undertake important fiscal reforms. These reforms, including improving fiscal governance and enhancing investor confidence, can help the country become more resilient in the long term. By addressing internal structural issues, Sri Lanka can better navigate global economic shifts and position itself for sustainable growth.
The Role of Technology and Digitalisation
Technology plays an essential role in Sri Lanka’s strategy to capitalise on global economic changes. The digital transformation of industries, driven in part by U.S. tariffs and trade disruptions, opens new avenues for economic development. For example, Sri Lanka’s growing IT sector, combined with advancements in e-commerce and digital infrastructure, allows the country to offer a variety of services to global markets, including financial services, software development, and education.
By investing in digital infrastructure and embracing new technologies like artificial intelligence and automation, Sri Lanka can position itself as a leader in the regional digital economy. This technological upgrade can help Sri Lanka integrate more deeply into global value chains, boosting exports and creating new economic opportunities. Possible benefits from US tariffs include,
Short-Term Benefits
* Diversified Exports: Emerging economies gain market share by offering alternatives to Chinese products.
* Increased Demand: Tariffs on China boost demand for products from other regions.
* Boost in FDI: Countries attract more foreign investments as supply chains shift.
* Lower Competition: Protectionist measures reduce competition for domestic industries.
Medium-Term Benefits
* Industrial Upgrading: Local industries modernise, innovate, and become more productive.
* Policy Reforms: Financial instability prompts improvements in governance and policies.
* Supply Chain Integration: Economies join more resilient and diversified global supply chains.
* Regional Trade: Strengthened trade partnerships with neighbouring countries and regional organisations.
Long-Term Benefits
* Structural Growth: Policy changes create a more resilient and diversified economy.
* Technological Advancements: Focus on innovation positions economies as leaders in new industries.
* Geopolitical Influence: Adaptation to global changes boosts regional and international influence.
* Better Positioning in Global Value Chains: Emerging economies align with evolving global demands, securing a stronger role in global trade.
A Turning Point for Emerging Economies
While U.S. tariffs initially cause economic disruption, they can also serve as a wake-up call for emerging economies like Sri Lanka. By diversifying trade relationships, investing in technology, and undertaking necessary structural reforms, countries can turn these challenges into long-term growth opportunities. The global shifts triggered by U.S. tariffs provide a unique opportunity for countries like Sri Lanka to reinvent their economic models, enhance their resilience, and position themselves as key players in the evolving global economy.
In this era of trade wars and economic realignments, smaller nations no longer need to simply weather the storm. With the right policies, proactive strategies, and a focus on innovation, countries like Sri Lanka can not only survive the disruptions caused by U.S. tariffs but thrive in the new economic landscape.
(The writer, a senior Chartered Accountant and professional banker, is Professor at SLIIT University, Malabe. He is also the author of the “Doing Social Research and Publishing Results”, a Springer publication (Singapore), and “Samaja Gaveshakaya (in Sinhala). The views and opinions expressed in this article are solely those of the author and do not necessarily reflect the official policy or position of the institution he works for. He can be contacted at saliya.a@slit.lk and www.researcher.com)
Opinion
From the Lecture Hall to the Global Market: How Sri Lankan students are mastering the “Gig Economy”
Have you ever wondered how a university student, between heavy textbooks and late-night study sessions, manages to earn a professional income in US dollars? It sounds like a dream, but for thousands of Sri Lankans, it’s becoming a daily reality through online freelancing.
A recent study published in the Ianna Journal of Interdisciplinary Studies has pulled back the curtain on this digital revolution. By interviewing 21 successful student freelancers across Sri Lanka, researchers have mapped out exactly what it takes to turn a laptop and an internet connection into a thriving career.
The Rise of the “Earn-as-you-learn” Era
In Sri Lanka, the number of online freelancers has exploded from about 20,000 in 2016 to over 150,000 today. While our traditional education system often focuses on preparing students for 9-to-5 office jobs , these students are diving into the “Gig Economy” a digital marketplace where they sell specific skills, like graphic design or programming, to clients all over the world.
The Secret Sauce for Success
So, what makes some students succeed while others struggle? The research found that it isn’t just about being good at coding or design. Success comes down to six “Core Pillars”:
· A Growth Mindset: The digital world moves fast. Successful students don’t just learn one skill; they are constantly updating themselves to ensure they don’t become “outdated”
· The Balancing Act:
How do they handle exams and clients? They don’t use a magic wand; they use strict time management. Many work late into the night (from 6 p.m. to midnight) to accommodate international time zones.
· The Power of “Hello”:
Since most clients are in the USA or UK, strong English and clear communication are vital. It’s about more than just talking; it’s about negotiating prices and building trust.
· Proactive Problem Solving:
Successful freelancers don’t wait for things to go wrong. They update their clients regularly and fix issues before they become headaches.
Why This Matters for Sri Lanka
Right now, our universities don’t always teach “how to be a freelancer”. This study suggests that if we integrate freelancing modules and mentorship into our degree programs, we could significantly reduce graduate unemployment. It’s a way for students to gain financial independence and bring much-needed foreign currency into our economy while still in school.
You Can Do It Too
If you’re a student (or the parent of one), the message is clear: the global market is open for business. You don’t need to wait for graduation to start your career. With a bit of flexibility, a willingness to keep learning, and a proactive attitude, you can transition from a learner to an earner.
The Research Team Behind the Study
This groundbreaking research was conducted by a dedicated team from the Department of Business Management at the SLIIT Business School (Sri Lanka Institute of Information Technology). The authors of the study include:
· Lihini Niranjana Dasanayaka
· Thuvindu Bimsara Madanayake
· Kalana Gimantha Jayasekara
· Thilina Dinidu Illepperuma
· Ruwanthika Chandrasiri
· Gayan Bandara
by Ruwanthika Chandrasiri
Opinion
Is India a ‘swing state’? A response
In an article titled “India shaping-up as model ‘swing state” (The Island 29.01.2026) Lynn Ockersz says, “Besides, this columnist would go so far as to describe India as a principal ‘Swing State.’ To clarify the latter concept in its essentials, it could be stated that the typical ‘Swing State’ wields considerable influence and power regionally and globally. Besides they are thriving democracies and occupy a strategic geographical location which enhances their appeal for other states of the region and enables them to relate to the latter with a degree of equableness. Their strategic location makes it possible for ‘Swing States’ to even mediate in resolving conflicts among states”.
A ‘swing state’, as in elections, should be able to decisively influence the final outcome. In the context in which India is recognised as a ‘swing state’ the final outcome should first be regional and then, if possible, extend to the rest of the world. And the desirable outcome must entail regional peace, cordial relations and economic stability which would constitute the most vital needs for any part of today’s world. Military power should not feature in the equation, for more often than not, such power is used to brow beat into submission the weak and the poor.
India no doubt is growing fast to be a global economic power and militarily also it is way ahead of the region. Its democracy, in the sense that democracies are measured in today’s world, also may be as the columnist says “thriving”. However, periodical elections, however fair they could be, should not be the sole criterion to judge democracy. If democracy cannot solve the problem of inequality it may lose its credibility as a mode of good governance. As a means of finding who rules, the system may be satisfactory but the other vital components of democracy, such as equitable wealth distribution, if lacking, the system may not serve its purpose.
Inequality in India is among the highest globally, with the top 1% owning nearly 40% of national wealth and the top 10% holding roughly 65% of total wealth and 58% of income. While the economy grows, the bottom 50% receives only 15% of the income. This disparity, driven by wealth concentration and low female labour participation, persists across class, caste, and gender. The income gap between the top 10% and the bottom 50% remained stable, with no significant reduction in inequality over the last decade.
India ranks very low in gender parity (127 out of 146 countries in the Global Gender Gap Report 2023). Female labour force participation is very low, at 15.7% (though government data suggests 41.7% by including agriculture and unpaid work). Women earn significantly less than men, working 53 hours per week compared to 43 for men. Inequality is intensified by existing social divides based on caste, religion, region, and gender. Access to healthcare is limited for many, with 63 million people pushed into poverty annually due to costs. Approximately 74% of India’s population could not afford a healthy diet in 2023. Roughly 64% of the total Goods and Services Tax (GST) in India comes from the bottom 50% of the population, whereas only 4% comes from the top 10% (Global Inequality Report 2024).
This sad state may not be the fault of democracy but the economic system of all so called democratic countries. The other three countries, Indonesia, South Africa and South Korea, that the columnist has named as suitable to be ‘swing states’ are no better. Neoliberalism and democracy are increasingly viewed by critics as an “evil nexus” or a destructive pairing, where the logic of the free market—privatisation, deregulation, and austerity—subverts the principles of democratic self-governance and social equality.
However, my main argument concerns the more important qualities that a country must possess to qualify as a ‘swing state’; the capacity to lead from the front in campaigning for peace and cordiality in the region. In this regard India fails miserably. The past with regards to good neighbourliness, where mighty India is concerned, tells a sad story. How it tried to solve the ethnic problem in Sri Lanka may be etched in the minds of those who lived in that era. The “parippu-drop” followed by gun-boat diplomacy saved the LTTE enabling it to continue with its murderous terrorism aimed at dividing the country. It was India who provided the initial “infra-structure” for training of terrorists who waged a thirty year war in Sri Lanka, committing brutal genocide against the Sinhalese and Muslims and not sparing the Tamils as well. India did not lift a finger to stop the bloodletting. Then it rammed the 13th A down our throats as a solution to the problem but did not keep to its terms and conditions which required it to disarm the LTTE. 13th A hangs over our head like the Sword of Damocles and India doesn’t fail to remind us about it from time to time. And we are burdened with the white elephant of provincial councils. Moreover, evidently India continues to interfere in our internal affairs, apparently colluding with the US, it may have had a hand in the regime change in Sri Lanka in 2022 (Shamindra Ferdinando, The Island, 04.02.2026). Another matter that appears to be perniciously secretive is that the Indian government doesn’t want the Sri Lankan government to reveal to its people the contents of the defence agreement it has entered into with the latter, as if people didn’t matter !
Now that tiny Sri Lanka is weakened and pliable after suffering multiple crises, India comes to its aid at the slightest mishap, very much like the hero who comes to the rescue of the damsel in distress, seemingly competing with other suitors. It doesn’t want the damsel to fall into the arms of China, given its geopolitical beauty.
Take the case of the other neighbours of India, does it have the capacity to swing, for instance, Pakistan into at least a position of less animosity. And what about its eastern neighbour, Bangladesh? They can’t even play cricket. Relations between India and Bangladesh, are currently under severe strain as of early 2026, driven by the ousting of former Prime Minister Sheikh Hasina, who has been given asylum in India to the chagrin of Bangladesh. Tensions are high due to attacks on diplomats, stalled visa services, water disputes, and alleged interference. The unresolved sharing of the Teesta River and other transboundary rivers remains a major contention, with Bangladesh accusing India of managing these to its detriment. Concerns exist in New Delhi regarding Bangladesh strengthening ties with other nations like Pakistan, seen as a shift away from Indian influence (Altaf Moti, 2026).
Coming back to the conflict with its western neighbour Pakistan, since the 1947 partition, both countries have claimed Kashmir, a region inhabited by a majority Muslim population but initially ruled by a Hindu Maharaja, leading to wars in 1947, 1965, and 1999. India accuses Pakistan of supporting militant groups in Kashmir, a claim Pakistan denies, which has frequently led to military escalations, such as the 2019 Pulwama incident and 2025 strikes. The Indus Waters Treaty is under strain, with potential for conflict over control of water resources. Both nations are nuclear-armed, raising international concerns about regional stability. Recent tensions included increased cross-border firing, drone warfare, and suspected militant attacks in Kashmir, leading to retaliatory missile strikes. The conflict remains a major geopolitical issue, with tensions frequently escalating due to nationalist sentiment and a lack of diplomatic progress (Britanica, 2026).
Another matter of relevance is that India-Pakistan-Afghanistan relations are defined by a complex, triangular, and competitive dynamic. Following the 2021 Taliban takeover, India has adopted a pragmatic, security-focused approach, delivering humanitarian aid to Afghanistan via Iran to circumvent Pakistan. Meanwhile, Pakistan-Afghanistan ties have deteriorated over border disputes, prompting Kabul to seek warmer relations with India as a counterweight to Islamabad. Without formally recognising the Taliban, India has re-established a technical mission in Kabul to secure its interests, monitor anti-India groups, and maintain developmental influence, which directly challenges Pakistan’s historical influence in the region. Is such manoeuvring of regional relations a virtue of a ‘swing state’!
Paradoxically, India is developing a special friendship with the murderous regime of Netanyahu in Israel focussing on defence and anti-terrorism. Indian prime minister is planning to visit Israel towards the end of this month which would obviously boost the image and credibility of a ruler who has committed genocide of the Palestinians. The barb no doubt is intended to prick Pakistan. Could such a country bring peace to the region, which it must if it is to qualify as a ‘swing state’.
India seems to have good relations with its northern neighbour, little Nepal, though minor but persistent issues remain. Disputes, notably regarding the Kalapani-Limpiyadhura-Lipulekh area, have caused tensions. Nepal has, from time to time, requested, a revision of the 1950 Treaty, viewing it as unbalanced. Growing influence of other foreign powers (particularly China) in Nepal poses a strategic challenge for India.
The other northern neighbour, the giant, is a different kettle of fish. India has fought several wars with China and there are frequent border skirmishes. The rivalry between these two giants is second only to that between the US and China. The war for markets, influence and hegemony between these countries may one day tear the world apart.
India seems to be having border disputes with most of its neighbours. Fortunately, we have no common border with it but there is Katchatheevu, on which they have recently made a claim.
India being the big brother must take the initiative to resolve the disputes it has with its neighbours and work towards lasting peace in the region. The inability to do so reflects, more than the external factor, the internal depravity that plagues its politics. One has only to listen to its political leaders during election times to gauge the depth of racism they descend to in order to swing the votes. This phenomenon is more evident in their own ‘swing states’. This racism cannot be confined to its borders, it has to cross the borders and be projected to the neighbourhood, if the politicians are to appear to be truly patriotic. Thus, the border disputes and acrimony continue.
If peace, cordiality and economic stability are the desirable goals for the region – one cannot think of anything more important than these – India may not be the ‘swing state’ that could give leadership to the struggle that would finally bring these qualities to the region.
by N. A. de S. Amaratunga
Opinion
Sovereignty without Governance is a hollow shield
Globalisation exposes weakness and failed governance; and invites intervention – A message to all inept governments everywhere
The government of Burkina Faso has shattered the illusion of party politics, dissolving every political party in the nation. Its justification is blunt: parties divide the people, fracture sovereignty, and allow corrupt elites to hijack the sacred powers that belong to the citizenry.
This is not an aberration. It is the recurring disease of fragile states. Haiti, Somalia, Sudan, Venezuela, Sri Lanka—their governments collapse under the weight of incompetence, leaving their people abandoned and their sovereignty hollow. These failed states do not merely fail themselves; they burden the world. Their chaos spills across borders, draining the strength of nations that still stand.
Globalisation does not forgive weakness. It exposes it. And as global opinion hardens, a new world order is taking shape—one that no longer tolerates decay. The moment of rupture came when US President Donald Trump seized Nicolás Maduro from his Venezuelan hideout and dragged him to face justice in America.
Predictably, the chorus of populists cried “oil!” They shouted about imperialism while ignoring the rot of Maduro’s failed government and his collapse in legitimacy. But the truth is unavoidable: if Venezuela had been competently governed, Trump would never have had the opening to topple its leadership. Weakness invited conquest. Failure opened the door.
Singapore offers the perfect counterexample. It is perhaps the best-governed nation on earth, and for that reason it is untouchable. Strong governance is the only true shield of sovereignty. Without it, sovereignty is a brittle shell, a flag waving over ruins.
Trump’s precedent will echo across continents. China, Russia, India—regional powers are watching, calculating, preparing. The message is unmistakable: Sovereignty is conditional. It is not guaranteed by history or by law. It is guaranteed only by strength, by competence, by the will to govern effectively.
This is the revolutionary truth: nations that fail to govern themselves will be governed by others. The age of excuses is over. The age of accountability has begun. Weak governments will fall. Strong governments will endure. And the people, sovereign and indivisible, will demand leaders who can protect their destiny—or see them replaced by those who can.
By Brigadier (Rtd) Ranjan de Silva
rpcdesilva@gmail.com
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