‘Must maintain current economic growth rate’ | Sunday Observer

‘Must maintain current economic growth rate’

Sri Lanka is expected to attain upper middle income status by 2019, if it maintains its current economic growth, Head of Trade at EU delegation in Colombo, Paul Godfrey said.

Sri Lanka maintained a steady economic growth of 4.4% last year while it was at 4.8% in the previous year according to the Central Bank.

Speaking to Sunday Observer, after the EU parliament shot down the motion by a group of 52 MPs to block Sri Lanka from gaining GSP+ status last week, he said even if the country moves up the ladder and enters the upper middle income category by 2019, it could enjoy duty free exports to Europe up to 2021. The EU trade concessions provide a grace period of three years for countries graduating from lower middle income to upper middle income level. The upper middle income countries are not qualified to export to EU under preferential trade status, which are given exclusively to low income countries and lower middle income countries.

GSP+ facilitates the export of about 6600 goods to the EU, duty free. Sri Lanka officially applied for the trade concessions in June last year after losing it in 2010 over allegations of breaches in the application of UN human rights instruments.

On Thursday, the EU parliament defeated a motion for a resolution objecting to the recommendation by the European Commission to grant GSP+ status to Sri Lanka.

Foreign Affairs Deputy Minister said, “With this the biggest hurdle was removed for Sri Lanka.” He said the cabinet approval for the new counter terrorism legislation helped to thwart the last minute attempt to block us from getting the concession.

The Delegation Head of Trade said the official period to lodge objections by the EU parliament will expire on May 11 and a decision on Sri Lanka will be taken on May 15.

“Theoretically Parliament can still make objections to Sri Lanka’s bid for GSP + status, although it was highly unlikely,” he said.

The motion that was defeated by 436 against and 119 for, cited the report of the UN High Commissioner on Human Rights that, ‘the measures taken by Sri Lanka since October 2015 have been ‘inadequate to ensure real progress’ and that the fulfillment of commitments has been ‘worryingly slow’.

Twenty two members of the EU parliament abstained from voting.