Commerce Department cautiously optimistic of TPP
A top government official recently cautioned the Government on its engagement with the United States in the Trans Pacific Partnership (TPP) agreement mooted by the new administration.Director General of Commerce Sonali Wijeratne addressing the Apparel Sources’ Association said the agreement was a single undertaking and that it covers several areas.She pointed out that Sri Lanka should be cautious in its dealings stating that while it could be carried out for the betterment of the country, the state should however define the strategic objectives and the pros and cons in entering into this agreement. For instance Ms. Wijeratne noted that in the apparel sector there were criteria in the Rules of Origin in the TPP adding that Sri Lanka needs to reduce the negative list to 10 per cent.
In an international agreement, a negative list is a list of those items, entities, products to which the agreement will not apply, the commitment being to apply the agreement to everything else.She also explained there were para-tariffs involved in entering into trade agreements, which means a charge on an imported good instead of or in addition to a tariff.Ms. Wijeratne observed that this could be injurious to the home industries and it was necessary to ensure that the TPP does not allow for that.However, she noted if there was enough political will to go ahead with TPP then Sri Lanka should look into the agreement.Commenting on the European Union (EU) GSP + agreement, the Director General said that they would be completing the application but needed to still await the full withdrawal of the fisheries ban.Further she explained that allowing EU officials to visit the country to monitor the ground situation was not a matter of infringing on Sri Lanka’s sovereignty but that it was all part of the agreement.
In fact, she noted that the monitory body would only ascertain whether there were no serious incidents on the ground.She also said that the next round of the China Sri Lanka FTA was postponed and noted that China wants to go on with less than 33 per cent on the negative list.
However, Ms. Wijeratne pointed out that the General Agreement on Tariffs and Trade says that substantial trade should be covered in a bilateral trade agreement and it could be 80 per cent of less and in this respect there has to be a cautious interest in going in for these agreements.
As part of the future plan the government is looking at entering economic engagements with countries like Japan, Bangladesh, Korea, Vietnam and the BRICS states or Brazil, Russia, India, China and South Africa.
Deputy Foreign Affairs Minister Harsha De Silva addressing the gathering said the need was to enter into these ties with the US under the TPP arrangement.In this respect, the government should look at adopting reforms to enable these agreements to take place, he pointed out.
The minister also said that the government was keen on getting GSP + back and that this did not amount to selling the country’s sovereignty.
A meeting with the EU officials would be held on December 11 and 12 to discuss how to regain the trade concessions to the European bloc, the minister said.Mid next year, the government is confident of regaining GSP + trade concessions for the country, Dr. De Silva said.