The Joint Apparel Association Forum (JAAF), the apex body for the Sri Lankan apparel industry, expressed optimism over the possibility of securing an industry-critical extension of the EU GSP+ program after its most recent round of discussions with the State Ministry of Regional Cooperation.
The meeting on July 16 was the third in a series of discussions initiated with the support of Namal Rajapaksa MP and attended by Tharaka Balasuriya, Admiral Prof. Jayanath Colombage Foreign Secretary, officials of the Ministry and representatives of the JAAF and focused on the importance of GSP+ to the apparel industry, and the wider economy, as well progress on reforms and related discussions aimed at securing the facility.
“We were pleased to learn that the Foreign Ministry will continue to engage with the EU on the Joint Commission and the Monitoring Mechanism of the EU GSP plus regime, while a sincere and committed effort is also being made to directly address all of their concerns. Based on the progress we are seeing, we are hopeful that a continuation of GSP plus can be secured,” JAAF Secretary General Tuli Cooray said.
The meeting builds on the process of continuous engagement that JAAF has with the State Ministry on this important topic of GSP plus. GSP plus benefits a number of industries besides apparel, fisheries, ceramics and agriculture.
Products exported to the EU fall under a total of 42 HS chapters which have a GSP plus utilization of over 75%. These varied industries have been contributing to the diversification of the country’s export basket which in itself is one of the objectives of the EU GSP plus program. These include a large number of Small and Medium Enterprises, which would be severely impacted by the loss of GSP plus and consequent increase in duties levied against Sri Lankan exports.
A recent resolution by the European Parliament urged the EU Commission to consider the temporary withdrawal of the GSP+ status offered to Sri Lanka putting the spotlight back on Sri Lanka’s human rights record.
The EU reinstated the special trade concessions for Sri Lanka in 2017 on the commitment to implement 27 international conventions on human rights, labour conditions, protection of the environment and good governance. The status effectively removes import duties on goods from Sri Lanka entering the EU.
EU’s GSP removes import duties from products coming into the EU market from vulnerable developing countries. This helps developing countries to alleviate poverty and create jobs based on international values and principles, including labour and human rights.
Almost 50 years ago, the United Nations Conference on Trade and Development asked developed countries to help developing countries integrate into the world economy. The Generalised Scheme of Preferences (GSP) was born and today, about a dozen countries have GSP mechanisms in place.