The GSP+ win

Challenged by a de-globalising world, Sri Lanka’s exports received welcome news this week when the European Commission proposed that the island should once again be covered under GSP+. While the Government should be applauded for lobbying the European Commission and its member countries for the return of the preferential tariff system at a time when the economy severely needs a boost from increased exports, it will need to continue its commitment to human rights and good governance, particularly reconciliation-related policies.   

The European Commission proposed that a significant part of the remaining import duties on Sri Lankan products should be removed by the European Union in exchange for the country’s commitment to ratify and effectively implement 27 international conventions on human rights, labour conditions, protection of the environment and good governance. 

It added in a statement issued by the Delegation of the European Union that these one-way trade preferences would consist of the full removal of duties on 66% of tariff lines, covering a wide array of products including textiles and fisheries. 

Granting access to the GSP+ scheme does not mean that the situation of the beneficiary country with respect to the 27 international conventions is fully satisfactory. Instead, it offers the incentive of increased trade access in return for further progress towards the full implementation of those conventions, and provides a platform for engagement with beneficiaries on all problematic areas.

As is the case for all GSP+ countries, the removal of customs duties for Sri Lanka would be accompanied with rigorous monitoring of the country’s progress in the area of sustainable development, human rights and good governance.     

Sri Lanka had already benefited from GSP+ in the past. In 2010 the EU decided however to stop the preferential treatment for Sri Lankan imports due to the failure to address reported human rights violations in the country. In 2015, the new Government of Sri Lanka set out a path of major reforms aiming for national reconciliation, respect of human rights, the rule of law and good governance principles, as well as sustainable economic development. The Sri Lankan Government applied for GSP+ in July 2016 and the Commission’s assessment has concluded that it met the GSP+ entry criteria set out in the EU regulation. 

Given the multiple rounds of assurances the Sri Lankan government has already received from key European countries it is unlikely that any objections would be raised over the next four months. No doubt the Government will take steps to intensify its engagement with the EU countries to avert any chance of a suspension. 

The news of GSP+ would also hearten good governance activists as it holds the Government to 27 international conventions and particularly focuses on the repealing of the Prevention of Terrorism Act (PTA). The Counter Terrorism Act, which is currently under discussion, has greater hope of being a progressive piece of legislation given the amount of international scrutiny directed at it. Other delayed measures such as the establishment of an Office for Missing Persons and a truth and reconciliation commission may also gain impetus from the GSP+ facility. 

But what would be even greater for Sri Lankans to see is the Government taking action because it is the right thing to do rather than being prompted by incentives from the international community.