Import restrictions stifle Lanka’s potential for trade with EU - Ambassador Chaibi | Sunday Observer

Import restrictions stifle Lanka’s potential for trade with EU - Ambassador Chaibi

14 February, 2021

Sri Lanka needs to recognise the  obstruction to  trade with the European Union (EU) due to the import ban which has stifled trade between the two markets, a sizeable component of trade for Sri Lanka, said Ambassador Delegation of the European Union to Sri Lanka and the Maldives, Denis Chaibi last week. “Sri Lanka competes on price and quality and has a unique advantage on quality over its competitors on certain products exported to the EU which Sri Lanka must capitalise and make good use of to boost trade with one of its largest trading markets,” the Ambassador said.However, he said that trade restrictions will not help advance trade with the bloc which Sri Lanka has gained since the reinstallation of the GSP Plus trade preferential scheme. “Trade between Sri Lanka and the EU has increased since resuming the GSP Plus scheme in 2017 which Sri Lanka should strive to sustain,” the Ambassador said adding that trade barriers need to be lifted for people to invest and Sri Lanka to boost FDIs.

He also noted that the EU considers the government’s priorities when it comes to providing assistance to a country. Agriculture and rural development has been a key sector the EU has assisted Sri Lanka. 

The EU granted Sri Lanka better access to the region in 2017 under the Generalised Scheme of Preferences Plus (GSP+).

The trade preferential scheme enables Sri Lanka to export more to the EU which will help Sri Lanka’s economy develop and create more and better jobs for its people. 

However, the scheme is conditional on Sri Lanka advancing human and labour rights and working towards sustainable development.

“The EU is a demanding market which focuses on quality standards. Therefore trading with the region requires meeting the conditions,” the Ambassador said.

The EU is Sri Lanka’s second-largest trading partner after India but its main export destination, absorbing 31% of Sri Lankan exports in 2015.

In 2016, Sri Lanka was the EU’s 62nd largest trading partner in goods accounting for 0.1% of EU trade.

Sri Lanka’s exports to the EU are dominated by textiles and clothing, accounting for 82% of Sri Lanka’s total exports to the EU in 2016.

Textiles and clothing account for 61.9% of Sri Lanka’s exports to the EU, followed by food products with 12.3% in 2016.

On the step-by-step trade procedures functionality of the Sri Lanka trade information portal launched last week the EU ambassador said the trade information portal will help bridge the information gap for Sri Lankan exporters especially for those in the regions who lack vital information to trade with the region.

The portal currently housed at the Department of Commerce contains trade related information in Sinhala, Tamil and English.

Technical support for the project was provided within the framework of the EU-Sri Lanka Trade Related Assistance project implemented by the International Trade Centre and funded by the EU.