In one day from today (19th May) Sri Lankan exporters would once again be able to export over 6,000 products duty free to European Union countries, giving a much needed boost to the export sector. Seven years since losing the preferential trade scheme, Sri Lanka has regained it following two votes; first at the EU Parliament and then at the EU Council of Ministers. This is an important victory for the country at a time when overall exports have been performing poorly. During 2015 and 2016, exports declined year-on-year for 17 months straight (March 2015 to July 2016) except for a modest bump in September, August and November 2016.
The primary way in which Sri Lanka will gain from GSP Plus is by our exporters having duty free access to the EU market on a whole range of products, which were previously only under a preferential tariff through the GSP scheme. The additional tariff advantage will greatly strengthen Sri Lankan exports’ relative competitive position in the EU. Sectors like apparels, processed food products, seafood, toys products, porcelain and ceramic ware, are some of the main sectors that will benefit under GSP Plus. The additional tariff concession gained by these sectors will vary; in many apparels categories duties are cut from 9.6% to zero, in the seafood sector from 18.5% to zero, in the fresh and processed fruits and vegetable sector from 12.5% to zero, in the porcelain and ceramic ware sector from 8.4% to zero, and in the toy products sector from 1.2% to zero.
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