GSP+ could help exporters meet target of US$ 20b

by Lalin FERNANDOPULLE

The export sector is targeting a turnover of US$ 20 billion by 2020 amidst challenges of the post economic crisis and bottlenecks in global trade reforms.

Exporters are optimistic but yet worried over the suspension of the trade concessions by the European Union (EU) and the lack of support to promote trade.

The EU accounts for a major share of Sri Lanka’s exports and the termination of the Generalised System of Preferences Plus (GSP+) would result in the loss of foreign earnings and a large segment of employment. Immediate Past President, National Chamber of Exporters, Rohan Fernando said Sri Lanka should engage in discussions with the EU officials and make its case to retain the trade concessions.

“Regaining the GSP+ benefits will not be a Herculean task to Sri Lanka which emerged victorious in routing out terrorism from the country”, he said.

The EU Financial ministers are said to endorse the suspension of the GSP+ concession to Sri Lanka when they meet on February 16 and when it’s confirmed it would be effective for six months giving time for Sri Lanka to address concerns.

Some of Sri Lanka’s main exports are tea, garments, rubber and rubber based products, cosmetics, coconuts and coconut products, ceramics, spices and allied products, fish and fisheries products, fruits and vegetables, handicraft, leather and leather products, ayurveda products, plastics and allied products, cereals and food stuffs and wood and wood products.

Sri Lanka exports mainly to USA, UK, India, Pakistan, Malaysia, Russia, Middle East, Singapore, Thailand, Bangladesh, Sweden, Switzerland, France and Germany.

Meanwhile, exporters have lost confidence in the Export Development Reward Scheme (EDRS) initiated by the Export Development Board (EDB) in 2008 due to strict conditions exporters have to adhere.

Small and Medium scale exporters said that the scheme rather than helping promote exports is discouraging as they are required to observe conditions to the letter. Maintaining 100 per cent employment is a case in point.

To the dismay of exporters the rewards for the third and fourth quarters of 2009 have not been paid and no applications have yet been called for 2010.

Chairman EDB, Anil Koswatte said as many exporters have benefitted from the EDRS the scheme will continue as an incentive to promote exports.