Will Sri Lanka lose GSP+ after 2023?

Will Sri Lanka lose GSP+ after 2023?

Will Sri Lanka lose GSP+ after 2023?

Written by Staff Writer

21 Jan, 2020 | 6:40 am

COLOMBO (News 1st) – The government announced that the European Union reassured that it will continue the GSP+ concessions to Sri Lanka till 2023 while noting that there will be ‘no changes’ in the monitoring process.

What exactly is this monitoring process; will Sri Lanka lose GSP+ after 2023 with becoming an upper-middle-income country?

News1st spoke to the Deputy Head of Mission of Delegation of the European Union to Sri Lanka in this regard. Thorsten Bargfrede, Deputy Head of Mission, Delegation of the European Union to Sri Lanka:

“The GSP+ is not automatic; it is granted based on promises and commitments to continue the effective implementation of 27 international conventions.

Related to human rights, labour rights, environment, and good governance and there is a continuous implementation based on these 27 conventions.

Now, for example, there are also regular monitoring missions, the last one was in September 2019 and then the overall global report on the GSP+ being included on progress in Sri Lanka will be presented to the parliament and discussed there in the next few months.”

The Generalised Scheme of Preferences Plus (GSP+) is a special component of the GSP scheme that provides additional trade incentives to developing countries, and duty-free access to EU markets for over 7200 products.

The EU is by far Sri Lanka’s biggest export destination with nearly 30% of the total exports going to Europe, a value of Euro 2.8 billion.

With Sri Lanka graduating from the GSP scheme in 2023, sectors that benefitted from the concession will be compelled to trade on standard trade terms.

Thorsten Bargfrede, Deputy Head of Mission, Delegation of the European Union to Sri Lanka:

“Legally from the Europe Union, it is not possible to retain it, the moment a country reaches upper middle-income status. What that would mean is eventually the trade will continue on standard WTO terms.

So the counting starts from the 1st of January 2020 essentially, and if during that 3 years for some reason the status changes again then the income goes below the upper-middle-income country Sri Lanka will be a full member again.

We would not hope that. However, the entire scheme is up for a review by 2023 on a global level from all countries benefiting from it so its very difficult to predict now what exactly our members or parliament will tell on the future of GSP+ scheme looks like. However, things would be more clear in a year or two I would think.”

The Acting Director-General of Commerce Nimal Karunathilake said that Sri Lanka’s graduation from GSP+ will not have a large impact on the apparel sector, which accounts for nearly 60% of the local export industry.

However, citing a few sectors that will be negatively impacted, Director-General Karunathilake said, Sri Lanka plans on making submissions to the European union in 2024, to retain the GSP concession.


Latest News

Are you interested in advertising on our website or video channel
Please contact us at [email protected]