On Wednesday 17 May, the European Commission announced that from 19 May the EU would grant trade preferences to Sri Lanka under the Generalised Scheme of Preferences (GSP+).
These unilateral preferences will result in the full removal of duties on 66% of the EU's tariff lines, covering a wide array of products exported by Sri Lanka including textiles and fisheries. In return, Colombo will have to ratify and implement 27 international conventions on human rights, sustainable development (working conditions and environmental protection) and good governance.
Sri Lanka benefitted from GSP+ until August 2010, when the EU decided to suspend this preferential treatment due to the lack of government measures to remedy human rights violations in the country (see EUROPE 10078).
In 2015, the new Sri Lankan government paved the way for major reforms aimed at national reconciliation, the respect of human rights, the rule of law and principles of good governance, as well as sustainable economic development.
Sri Lanka requested GSP+ in July 2016 and the Commission's assessment resulted in the conclusion that the criteria for participating in this system (provided for in the EU rules) had been met.
Sri Lanka has taken key measures to improve the respect of human rights and extend good governance – like the 19th amendment of its Constitution, which re-establishes the independence of key institutions such as its National Human Rights Commission.
Colombo has also adopted concrete measures to ensure cases of missing persons are examined, to offer better protection of witnesses and victims, to release people detained under controversial anti-terrorism regulations, and to combat child labour.
The country has also re-engaged with the UN system, in particular the UN Human Rights Council, where it has made commitments to promote reconciliation, accountability and human rights. Sri Lanka has furthermore achieved most of its Millennium Development Goals, especially in health, education and gender equality.
However, the EU requires further work to ensure Sri Lanka's counter-terrorism legislation is fully in line with international human rights conventions. It also requires Sri Lanka to put a definitive stop to the use of torture by security forces and the related impunity.
Colombo must also adopt policy and legislative processes to improve the rights of women and children – for example with regard to discrimination, domestic violence, the minimum age of marriage, and sexual exploitation – and to address the issue of harassment of trade unions.
All of these issues will be subject to GSP+ monitoring.
If it continues its progress, Sri Lanka will be able to benefit from the GSP+ scheme until it achieves upper middle income country status for three consecutive years. On current trends, this could mean that Sri Lanka will benefit from GSP+ until at least 2021.
The EU is Sri Lanka's biggest export market, accounting for nearly one-third of Sri Lanka's global exports. In 2016, total bilateral trade amounted to almost €4 billion. EU imports from Sri Lanka amounted to €2.6 billion and consisted mainly of textiles as well as rubber products and machinery.
The removal of import duties will provide immediate benefits worth in excess of €300 million a year for Sri Lankan exporters. (Original version in French by Emmanuel Hagry)