Lanka likely to lose GSP Plus

Sri Lanka’s fate vis-à-vis the GSP Plus tax free trade benefits enters its final phase when the Council of the European Union receives tomorrow (Monday) a set of recommendations from an experts committee which has, in effect, accused the government of violating international human rights laws, industry officials said on Saturday.

The Council has two months, from Monday, to decide as to whether the European Union (EU) should accede to Sri Lanka’s request for a second round of tax free concessions which have been mostly used by garment exporters here.

“The European Commission (EC) hired three experts to review Sri Lankas request and ascertain whether the country has kept its promise in implementing a set of international human rights conventions. That report has been now turned into a set of recommendations and being presented to the Council on Monday,” a highly-placed garment industry source, familiar with this system, told the Sunday Times.

He said the government was asked for a response to the report and since this didn’t happen, the three experts have made a set of recommendations, which he said he didn’t have details. Please turn to. “We should be careful not to pre-judge the issue. The report can make recommendations… even say Sri Lanka is not be entitled to these concessions … but it’s the Council that makes the final decision,” the industry official, who declined to be named, said.

Separately, the Labour Ministry on Wednesday summoned a meeting of trade unions and employers to work out a road map on implementing labour standards as laid down by the ILO.

Palitha Athukorala, President of NATURE, a collective of trade unions that sought government intervention in the matter, told the Sunday Times that the meeting decided to come up with an action plan on implementation of labour standards which would be followed by an agreement between the unions and employers. “This would then be passed onto the EU as a promise of action to be taken to ensure implementation of the international conventions,” he said.

Foreign news agency reports on Friday said the EU investigation found Sri Lanka in breach of international human rights laws and that it is most likely to lose concessions worth over $100 million for its top exports to Europe.

Quoting EU sources said, Reuters reported that Brussels is expected to publish on Monday the findings of the investigation launched a year ago into allegations of human rights violations and torture in the war between the Sri Lankan government and the LTTE.

“The evidence is very clear that Sri Lanka does not fulfil the basic human rights conditions of GSP Plus,” one EU source was quoted as saying.International Trade Minister Prof G.L. Peiris has repeatedly said the government will not allow an investigation as requested by the EU. Prof Peiris is part of the 4-member ministerial committee that has been asked by the President to resolve the impasse over the GSP Plus crisis which garment exporters say is vital to the industry.

Newly appointed Ministry Secretary S. Liyanagama, when asked to comment on the status of this process, said the Minister held a meeting on Friday to discuss the issue. “I was not present at the meeting, so I don’t know what transpired.”Sources close to the committee said the Foreign Ministry has been assigned the task of handling this issue with Sri Lankas mission in Brussels.

The EC report given to the government caused a major stir locally after International Trade Ministry Secretary S. Ranugge was quoted in a news report as saying the EU investigation had serious strictures against Sri Lanka and cast doubts on whether the concessions would be given.

He was subsequently transferred but chose to send in his papers for retirement, official sources said.
Garment exporters say if the Council decides to turn down Sri Lanka’s request, it would give the government six months time (from the date of the decision) to reverse its decision (on non conformity). “During this time, buyers will move to other supplying markets if there is no change of heart from the government,” one exporter said.

However if the EU turns down Sri Lanka’s request, the government has offered a subsidy to exporters who have benefitted from tax free exports – to be passed on to buyers, the Sunday Times reliably understands.

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