GOVT. EXPECTS GSP PLUS BY MAY 15
Motion needs to be signed off by European Council of Ministers:
Concession withdrawn from Sri Lanka in 2010 due to country’s poor human rights record:
The government expects to be officially granted the Generalised Scheme of Preferences (GSP) Plus from the European Union by May 15, Deputy Minister of Foreign Affairs Harsha de Silva said.
The motion to deny Sri Lanka of the GSP Plus concession was defeated at the European Parliament on Thursday but it still needs to be signed off by the European Council of the Ministers to become official.
“We have passed the biggest hurdle, the next steps are procedural,”Deputy Minister de Silva said addressing a media briefing at the Ministry of Foreign Affairs yesterday.
The GSP plus concession which was withdrawn from Sri Lanka in 2010 due to the country’s poor human rights record, had according to the Deputy Minister resulted in a loss of 150-200 million Euros in the country’s exports,
“It was not until 2015, when we took over power that we re-started negotiations with the EU to regain GSP Plus”, said de Silva and stressed that the European market was an extremely important one for Sri Lanka.
He said with the GSP Plus concession, there was a complete removal of 9-10 percent in duty for exports to the EU.
The concessions however are open to around 6,600 products but Sri Lanka exported only a few of them,
“Our exports for many years have not diversified. We need to diversify in order to achieve the economic growth we need. “The main objective of building airports, ports and trade agreements are to increase exports. An economy cannot grow with increasing exports,” he said.
In 2000, exports made up 34 percent of the country’s GDP but by 2015, it was stood at 13 percent of GDP. There has been no marked improvement in the number in the last two years either.
“This is a great turnaround for our exports. One of the main reasons our diversification into other areas has not improved is because we have not been able to compete with other countries which have had a better relationship with the EU,”the Deputy Minister said.
The markedly improved relationship between the current government and the EU however is based on the premise that the government was working on improving its commitments to the 27 International Human Rights conventions the country is party to. Given that there is still more work to do in that field, De Silva said that the government’s commitment to rule of law, good governance and human rights had nothing to do with ‘Geneva’ or ‘GSP Plus’ and that they would fulfil their obligations made to the people.
As the country’s per capita income increases, Deputy Minister De Silva pointed out that the benefits of the GSP Plus would be short lived.
“Countries which have achieved an upper-middle income ($4,036) per capita during three consecutive years, according to the World Bank classification will not be applicable for GSP Plus,” he added.
“We hope to reach the upper middle income status by the end of the year. So we have three more years to enjoy the concession. In such a scenario, we would have to look to starting negotiations with the EU on a Free Trade Agreement (FTA),”Deputy Minister de Silva said.
“In addition, with the likelihood of Brexit being completed in the next two years, Sri Lanka would also lose duty free access to the British market. To combat these issues, the Deputy Foreign Minister said Sri Lanka would work out a new agreement with Britain and explore FTAs between Commonwealth countries, “We have started negotiating FTAs with New Zealand and Singapore already,”he added.
excerpt to daily news
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