The Government yesterday said it is following a two-pronged approach with regard to the future of the EU GSP+ scheme.
State Minister of Money, Capital Market and State Enterprise Reforms Ajith Nivard Cabraal said the Government will address some of the issues and in parallel be ready if the EU becomes unreasonable.
“The EU GSP+ is conditional and these are more political than economic conditions,” he said addressing a webinar titled ‘Will the economy collapse? Will GSP+ be lost?’ organised by the Government Information Department.
“The Government will definitely do an explanation of the facts, and diplomatic efforts to avoid such a situation are being pursued at present. Secondly, we as an economy need to be prepared to face the situation if the GSP+ facility is withdrawn. So, steps are underway to deal with this on a twin approach in the diplomatic front, whilst being prepared to deal with it on the economic front,” Cabraal said.
The State Minister said history repeats with the same reaction from the opposition years after, but it will eventually be yet another false claim.
Citing some figures before the EU GSP+ was withdrawn and after, he pointed out that the predicted claims of exports collapse never took place, rather it increased each year till the previous regime regained the facility in 2017 putting the sovereignty of the country at risk.
“In 2010, when the facility was withdrawn, the total exports to the EU was at $ 2.9 billion. Then everyone was concerned that our exports will not survive it and there will be factories closed, job losses and economic crash. But what eventually happened was quite the opposite of their claims. In 2011, with no GSP+, our total exports to the EU was at $ 3.6 billion, up by 20%, and no one speaks about it,” he stressed.
Cabraal also said the Government will have a broader dialogue with the relevant sectors concerned in the near future.
“We will not endanger the sovereignty of the country to retain the EU GSP+. We will guide the economy to be better prepared in case the EU GSP+ is withdrawn. Our challenge is to face this situation and take all measures to overcome it,” Cabraal assured.
The EU Parliament last month adopted a resolution calling on the EU Commission to consider the temporary withdrawal of Sri Lanka’s GSP+ status and the benefits that come with it, noting the Government’s persistent failure to adopt and enact human rights reform and repeal the ‘draconian’ Prevention of Terrorism Act (PTA). The Resolution on Sri Lanka was adopted with 628 votes in favour, 15 against, and 40 abstentions.
The EU resolution takes specific issue with the use of the PTA to crack down on minorities and dissidents, and urges the Commission and the European External Action Service (EEAS) to use the preferential trade concessions as ‘leverage’ to push for advancement on Sri Lanka’s human rights, and demand the repeal or replacement of the PTA.
(FT)