SL adopts measured stance in trade talks with US

Finance and Planning Deputy Minister Dr. Harshana Suriyapperuma

•  Finance and Planning Deputy Minister Dr. Harshana Suriyapperuma says SL adopts strategic, non-committal stance avoiding fixed tariff proposals
• Stresses on transparency, competitive parity and long-term trade cooperation 
• Says objective is to maintain competitive position of SL exports, continued access to US market 
• Asserts USTR officials positively received domestic industry consultations in shaping SL’s approach 
• Notes further high-level discussions expected soon
• Energy sector flagged as key area for deeper trade ties 
• Highlights openness to US exports, investment facilitation, policy clarity and a level playing field  
• Informs US officials on SL’s financial constraints amid an ongoing IMF program differentiating situation from others 
• Reiterates US appreciative stance on SL’s transparency, anti-corruption reforms, contrasting past governance practices 

By Charumini de Silva

In a bold move to protect its export strongholds without trying itself to fixed figures, Sri Lanka has drawn a clear line with no specific tariff proposals, just a strategic pitch to keep its edge in US trade. 

Finance and Planning Deputy Minister Dr. Harshana Suriyapperuma yesterday speaking on the outcome of recent high-level meetings with the United States Trade Representative (USTR) in Washington, noted that the country stepped up its efforts emphasising transparency, competitive parity and long-term collaboration. 

He described the Government’s approach as both timely and strategic, ensuring Sri Lanka’s position amid broader US tariff recalibrations affecting multiple countries.

“It is very important to note the approach that the Government has taken and the counterparts appreciated, particularly from the USTR officials. It was a good opportunity for us to get a time slot to meet early, while many other countries are trying to reach out to the US for these discussions,” Dr. Suriyapperuma said. 

Crucially, he said Sri Lanka was not being singled out but was navigating the same challenges as many other countries amid the global reassessment of tariff frameworks by the US, intended to address its trade deficit and optimise international trade relationships.

“The objective is to maintain the competitive position that Sri Lanka is enjoying as a country, depending on how the US finalises with other countries. Then Sri Lanka needs to ensure that we will be in a competitive position continuously with the same market access to the US, particularly for apparel and rubber,” he stressed, noting that the Government is eager to see to what extent Sri Lanka is able to close this engagement within the 90-day period.

The discussions, facilitated through the US Embassy and the USTR office were part of Sri Lanka’s broader efforts to navigate the challenges posed by the recent US tariff policies. While the US had initially imposed a 44% reciprocal tariff on around $ 3 billion worth of Sri Lankan exports, this was later suspended for three months with a baseline 10% tariff remaining in place. 

The Deputy Minister underscored that Sri Lanka’s readiness was boosted by extensive domestic consultations. “The Sri Lankan approach was not just one-sided. We had discussions with the industry before we formulated our response. Based on that, and considering the important requirements of industry, particularly to maintain the competitive position our industries are maintaining in the global framework—we formulated our response and it was very well received,” he added. 

Moving forward, Dr. Suriyapperuma said another delegation-level discussion is expected soon. “We were able to reach out to the highest level in terms of the discussion hierarchy for them to take the proposals to the administration and to finalise,” he pointed out.

At the core of the talks were two key US priorities: reducing the trade deficit and reevaluating tariff structures. From Sri Lanka’s side, a key objective was the preservation of the country’s competitive edge. 

Given the constrained fiscal decision-making process due to its IMF program and a rigorous revenue consolidation agenda, the Deputy Minister said the matters were clearly communicated and received with understanding by the US officials. 

“We are going through an ambitious revenue consolidation program. There are certain challenges that Sri Lanka faces, which other countries are not subjected to at present,” he explained. 

With US concerns largely aimed at ensuring fair access to its exporters, Sri Lanka emphasised its own openness, including the fact that many US imports already enter the country duty-free. “Even as of now, many items imported from the US to Sri Lanka are with zero Customs duty,” he said, citing pharmaceuticals and animal feed among notable examples. 

When asked if there were any possible trade deal discussed during the recent meetings, Dr. Suriyapperuma said that though no formal agreement was tabled, the Sri Lankan side emphasised a desire to continue dialogue with the long-term goal of institutionalising trade cooperation. “Particularly, it is to ensure that we will maintain this dialogue, allowing Sri Lankan exporters to continue export to the US in a manner while maintaining their existing competitive advantageous position,” he added.

One of the standout sectors discussed was energy, where Dr. Suriyapperuma noted energy imports—such as oil, gas and refined petroleum products remained one of Sri Lanka’s largest external expenditures offering a potential area for deeper trade cooperation.

“There is a vast opportunity for somebody who’s competitive enough to provide with the best pricing to engage with Sri Lanka—either in the gas segment or in the oil segment or the fully refined petroleum or crude oil supply segment,” he stated, adding that these were presented as priority opportunities for US suppliers. 

Noting that no other sectors were extensively explored in these initial talks, he said US officials expressed interest in ensuring fair access to the Sri Lankan market for American exporters and Sri Lanka extended its willingness to provide further information on potential trade areas. 

“There are several items that the US is currently supplying and they are quite strong—for example pharmaceuticals and animal feed supply to Sri Lanka,” Dr. Suriyapperuma noted, suggesting that the scope of collaboration could expand.

Beyond trade flows, investment facilitation also emerged as a topic of mutual interest. Both Governments signalled a commitment to fostering an open non-restrictive environment for investors, with Sri Lanka pledging to maintain policy clarity, transparency and institutional support. 

“It is to ensure we provide a level playing field and facilitation, allowing exporters from the US to explore opportunities in Sri Lanka and for US investors to explore opportunities without being restrictive,” he added. 

The meetings also became a platform for Sri Lanka to underscore its ongoing economic reforms under the IMF program. “Our ability to make certain decisions are limited to the extent of the program parameters that we are supposed to comply with,” Dr. Suriyapperuma said, highlighting the constraints that differentiate Sri Lanka’s situation from others.

The Deputy Minister said the US official appreciated Sri Lanka’s transparency, formal engagement and anti-corruption stance. “The talks were also an avenue to rebuild trust and credibility, particularly in past governance failures. In contrast to past administrations, where opacity and politically driven deals hindered progress, the US officials appreciated the new Government’s stance of zero tolerance for corruption,” he said.