Columns

• More talks with US trade officials planned to further reduce tariffs and remain competitive against rival exporters
• Opposition SJB extends support to Govt.’s tariff talks, as leader Sajith faces probe over Central Cultural Fund activities
• Dayasiri slams CID summons, links them to attempts to silence opposition’s criticism over container scandal

By our Political Desk

Wednesday’s announcement by the United States that it intends to impose a 30% tariff on imports from Sri Lanka starting from August 1 was touted by the government as a significant success. This was on the grounds that the new tariff rate is 14% lower than the 44% tariff President Donald Trump announced on April 2 during his so-called “Liberation Day” address on the White House lawn, when he imposed sweeping new tariffs on dozens of countries which, he claimed, have “cheated” the US.

The National People’s Power (NPP) government’s argument that this reduction is a victory for Sri Lanka is not without merit. Of the 23 countries to which the Trump administration fired off letters this week outlining higher tariffs they will face if they do not make trade deals with the US by August 1, Sri Lanka has the biggest drop from the rates that President Trump threatened to impose on April 2. The US President later announced a 90-day pause for most of the tariffs that were originally due to go into force on April 9, only keeping a baseline tariff of 10% for all countries. Instead, he imposed a July 9 deadline for countries to negotiate trade deals with the US.

President Anura Kumara Dissanayake convenes the government's economic team to discuss the Trump tariffs

Tariffs put off again as US fails to secure trade deals

Though Trump administration officials initially suggested they would strike dozens of trade deals by the July 9 deadline, only two deals have so far been announced. The first of these deals, signed with the United Kingdom, still includes a 10% tariff on most UK goods. A trade deal with Vietnam has also been announced, which sets a 20% tariff on most of that country’s exports to the US. That is down from the 46% announced on April 2. Full details on this agreement, however, are yet to be announced, leading to questions as to whether the two sides did, in fact, reach a final agreement.

Some US media reported on Friday that Vietnam had been caught off-guard by Mr. Trump’s announcement on his Truth Social account last week that it had agreed to a 20% tariff, when its negotiators had been seeking a far lower rate. Vietnam’s leadership has now instructed its negotiating team to keep working on securing a more favourable tariff range.

The United States’ lack of progress in signing new trade agreements has ultimately forced Mr. Trump to again put off imposing higher tariffs on other countries. He has insisted there would not be a further extension of the August 1 deadline, though given his wildly unpredictable nature, this assertion should be taken with a pinch of salt.

Sri Lanka was among the second group of countries to which letters were sent out detailing the new tariff rates. All letters were published on social media accounts of President Trump and the White House. In an embarrassing gaffe on the part of US authorities, the letter addressed to President Anura Kumara Dissanayake initially misspelled his name as “Aruna Kumara Dissanayake.” The letter was later reposted with the correct spelling. An analysis of the letters posted so far indicates they have followed the same template, with only minor edits, for most countries. The letters are notable for their poor grammar, random capitalisations, and language that can only be described as plain weird.

Following is the letter President Trump has addressed to President Dissanayake in full (random capitalisations and all):

The White House

Washington

July 9, 2025

His Excellency

Anura Kumara Dissanayake

President of the Democratic Socialist Republic of Sri Lanka

Colombo

Dear Mr. President:

It is a Great Honor for me to send you this letter in that it demonstrates the strength and commitment of our Trading Relationship, and the fact that the United States of America has agreed to continue working with Sri Lanka, despite having a significant Trade Deficit with your great Country. Nevertheless, we have decided to move forward with you, but only with more balanced, and fair, TRADE. Therefore, we invite you to participate in the extraordinary Economy of the United States, the Number One Market in the World, by far. We have had years to discuss our Trading Relationship with Sri Lanka, and have concluded that we must move away from these long-term, and very persistent, Trade Deficits engendered by
Sri Lanka’s Tariff, and Non-Tariff, Policies and Trade Barriers. Our relationship has been, unfortunately, far from Reciprocal. Starting on August 1, 2025, we will charge Sri Lanka a Tariff of only 30% on any and all Sri Lankan products sent into the United States, separate from all Sectoral Tariffs. Goods transshipped to evade a higher Tariff will be subject to that higher Tariff. Please understand that the 30% number is far less than what is needed to eliminate the Trade Deficit disparity we have with your Country. As you are aware, there will be no Tariff if Sri Lanka, or companies within your Country’, decide to build or manufacture product within the United States and, in fact, we will do everything possible to get approvals quickly, professionally, and routinely–In other words, in a matter of weeks.

If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 30% that we charge. Please understand that these Tariffs are necessary to correct the many years of Sri Lanka’s Tariff, and Non-Tariff, Policies and Trade Barriers, causing these unsustainable Trade Deficits against the United States. This Deficit is a major threat to our Economy and, indeed, our National Security!

We look forward to working with you as your Trading Partner for many years to come. If you wish to open your heretofore closed Trading Markets to the United States, and eliminate your Tariff, and Non-Tariff, Policies and Trade Barriers, we will, perhaps, consider an adjustment to this letter. These Tariffs may be modified, upward or downward, depending on our relationship with your Country. You will never be disappointed with The United States of America.

Thank you for your attention to this matter!

With best wishes, I am,

Sincerely

DONALD J. TRUMP

PRESIDENT OF THE UNITED STATES OF AMERICA

The letter may be poorly written, but the message it conveys is clear enough. The Trump administration has characterised the US’s trade deficit with Sri Lanka (and other countries targeted in the letters) as a threat to its economy and national security. The only way Sri Lanka can stave off the 30% tariff the US intends to impose on its exports to the country is by opening up its “heretofore closed Trading Markets to the United States,” and eliminating its tariff and non-tariff policies and trade barriers.

The 30% tariff will be added to different tariff amounts already levied by the US on Sri Lanka’s exports to the country. This will be the case with all other countries targeted by the US as well.

Sri Lanka intent on continuing
trade negotiations

The letter announcing the new tariff on
Sri Lanka was posted on Wednesday night, Sri Lankan time. As such, though Thursday was a Poya holiday, there was heightened activity at the presidential secretariat. President Dissanayake met with key ministers and government officials involved in trade negotiations with the US to discuss Sri Lanka’s response. Those present included Labour Minister and Economic Development Deputy Minister Dr. Anil Jayantha Fernando, Treasury Secretary Dr. Harshana Suriyapperuma, Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe, Trade Ministry Secretary K.A. Vimalenthiraja and the President’s Senior Economic Advisor Duminda Hulangamuwa.

The same day, Dr. Suriyapperuma, Dr. Weerasinghe, Mr. Vimalenthiraja and Mr. Hulangamuwa also fronted a special news conference at the Government Information Department to brief the media about developments on the government’s side following the US announcement. Dr. Suriyapperuma noted that Dr. Weerasinghe, Mr. Vimalenthiraja, Mr. Hulangamuwa and
Sri Lanka’s Ambassador to the US, Mahinda Samarasinghe, have been involved in trade negotiations with US authorities. Mr. Samarasinghe took over as Sri Lanka’s Ambassador to the US way back in December 2021 after being appointed to the post by the Gotabaya Rajapaksa government. The former minister has continued to remain in his post despite all the political and economic upheavals that have taken place since. Mr. Samarasinghe functioned as ambassador in Washington under former President Ranil Wickremesinghe as well, assisting negotiations with the International Monetary Fund (IMF). He was one of the few political appointees who functioned as heads of mission under the previous government to be allowed to remain at his post once the NPP took over, mainly due to ongoing discussions with the IMF. Since President Trump announced his sweeping tariffs in April, Mr. Samarasinghe has also found himself as part of the team negotiating with the US on that matter.

Speaking during the news conference, Dr. Suriyapperuma revealed that the two sides held many rounds of discussions—both in person and online. “The main objective of these discussions was to prepare a programme whereby our exporters can continue to enjoy the competitive advantage they have in the region,” the Treasury Secretary said. He described the significantly lower tariff announced for Sri Lanka following these discussions as an excellent initial step. What Sri Lanka intends to do now is to immediately connect with the relevant stakeholders and continue its engagement and dialogue with the US to further reduce the impending tariff before the August 1 deadline, he added.

The government managed to significantly reduce the tariff originally imposed on Sri Lanka by negotiating in good faith, Central Bank Governor Weerasinghe said. He pointed out that Mr. Trump’s letter had indicated there was further scope to reduce the 30% tariff as well through negotiations. Accordingly, Sri Lanka would hold more talks with the aim of further improving its competitive advantage, he stressed. “If we had agreed to everything that was proposed, we could have concluded these discussions already, but we cannot do that. We are always considering how much of an impact these decisions will have on our economy and society, and the extent to which we can open up our markets.”

He stressed that Sri Lanka was not satisfied with having a 30% tariff. “We are satisfied where we are now and with the progress we have made from 44% to 30%. But we want to make more progress; that is why we continue to engage with them.”

Mr. Trump’s letter had warned Sri Lanka that if it attempted to retaliate against the US by raising its own tariffs charged on US imports to the country, whatever that number is would be added to the 30% charge the US intends to levy from Sri Lanka. When questioned about possible retaliation from the
Sri Lankan side, Mr. Hulangamuwa pointed out that this was a warning issued to all the trading partners in the letters sent by the US President. He stressed the government has no intention of retaliating against US tariffs.

No clarity on trade concessions to US

The Trump administration’s complaint when imposing the tariffs on the targeted countries is that there is a significant trade deficit in trade between those countries and the US. This is correct in
Sri Lanka’s case. Official data indicates that trade between the two countries is heavily in favour of
Sri Lanka, which exports primarily apparel, rubber products, and seafood, among other items. US exports to Sri Lanka in 2024 totalled USD 368.2 million, while Sri Lanka’s exports to the US were USD 3 billion in the same year. Accordingly, the Sri Lankan government may have to make significant concessions to bridge this trade deficit.

When pressed by journalists on what Sri Lanka had agreed to for the Trump administration to significantly lower the tariff it had threatened to impose against Sri Lanka in April, the government’s negotiators insisted nothing had been finalised as yet, stating that the result was achieved because US authorities were satisfied that Sri Lanka was negotiating in good faith to bring benefits to both countries. “Nothing has been agreed to so far. It’s a process of negotiation where we offer what we can offer and they offer what they can offer,” Dr. Weerasinghe said, noting that they would be able to come to an agreement at the end of the negotiation process. The negotiation process is not simply about reducing tariffs and para-tariffs charged by
Sri Lanka on US products but is much broader, said Dr. Suriyapperuma. Discussions are also focusing on simplifying the process so that clearances at border agencies would be much faster, and removing some of the trade barriers Sri Lanka has, he added.

Given this situation, exactly what trade concessions Sri Lanka may eventually agree to make to the US to persuade the Trump administration to further reduce its import tariffs from 30% remains to be seen. The government has stressed that it is still in the process of negotiating with the office of the US Trade Representative. Deputy Economic Development Minister Dr. Anil Jayantha Fernando told the Sunday Times yesterday that for now, communications with US authorities are continuing virtually. “Visits may be arranged if a need arises,” he added.

Other countries in the Asia region have also intensified negotiations to lower tariffs set to be imposed on their countries by the US. A high-level trade delegation from the Bangladesh government is currently in the US for tariff talks with the aim of reducing the 35% import tariff imposed on their country. An Indian government delegation is also due in Washington next week for further talks as part of efforts to ink a trade deal between the two countries. Meanwhile, despite a deal not being finalised yet, Vietnam is also expected to come to an agreement with the US on tariffs soon. Given that these countries are in direct competition with Sri Lanka when it comes to some of their exports to the US, these export sectors are likely to take a serious hit if the country’s competitors secure more favourable terms than Sri Lanka.

SJB critical of Govt. response,
but pledges support to secure deal

Sections of the opposition criticised the government over its failure to secure a lower tariff rate for Sri Lanka. “A 30% US tariff on Sri Lankan exports is the price we pay for poor negotiations. Our ego kept us from seeking every ally, every expert hand, and now nearly $3 billion in exports hangs in the balance,” the main opposition Samagi Jana Balawegaya (SJB) leader Sajith Premadasa said on X. He added that the development is a good case study “on
how textbook experts are not meant for real world negotiations.”

Mr. Premadasa also posted a video statement on his social media accounts expanding on his criticism. He said the impending US tariffs will have a major negative impact on the country’s exports, especially in sectors such as apparel, tea, rubber, IT, business process outsourcing, and fisheries. He pointed out that the exports could become commercially unviable if the 30% tariff went into effect.

Mr. Premadasa also warned of a severe impact on the apparel sector, noting that 60% of the country’s apparel exports were to the US. He claimed that many in the industry fear that if the tariffs go into effect as they are now, it could see a reduction in orders by between 30% and 40%. The same negative effect would be seen in the tea and rubber sectors, he added. The resulting loss of foreign exchange would lead to a depreciation of the rupee, which could lead to a rise in inflation and import costs.

While noting that a tariff reduction from 44% to 30% is a welcome step, SJB MP Dr. Harsha De Silva questioned whether it is competitive. “With 350,000 apparel jobs and 600,000 linked roles at stake, plus over $2 billion in export revenue, we must outperform our key rivals. Vietnam sits at 20%, Bangladesh at 35% (still negotiating), and India is pushing aggressively. This 30% stacks on top of existing MFN (Most-Favoured-Nation) tariffs (0-25%, averaging ~12% for key HS codes), lagging behind competitors,” he said in a post on X.

He noted that though he has repeatedly urged the government to leverage expertise from the opposition for a stronger deal, his calls have been ignored. “Alarmingly, the international trade negotiator position has remained vacant since November 2024, with no dedicated team in place—just part-time negotiators. We desperately need a robust national export strategy to guide us.” Dr. De Silva urged the government to decisively re-engage with the US trade team and said the opposition “stands ready to support the government, setting aside political affiliations, to get this right for Sri Lanka.”

The US tariff matter also came up in Parliament on Friday, where Mr. Premadasa struck a more conciliatory tone than he had earlier done on social media. He said the opposition is ready to support efforts to secure the best possible deal for Sri Lanka. While the drop from 44% to 30% was welcome, he stressed the government needed to make a massive diplomatic push over the next three weeks to further reduce the tariff, given that Sri Lanka’s competitors were also doing the same.

Sajith faces probe over CCF funds

The opposition leader, meanwhile, is likely to come under renewed pressure as the government reopens an old case with regard to the use of monies from the Central Cultural Fund (CCF) for distribution to places of religious worship under a programme initiated by Mr. Premadasa when he served as Minister of Housing, Construction, and Cultural Affairs when the CCF came under his purview.

The Sisu Daham Sevana programme that he launched in March 2019 has been plagued with controversy and has been investigated in the past by the Committee on Public Enterprises (COPE) as well as a committee appointed by then Prime Minister Mahinda Rajapaksa in 2020, and in both instances, allegations have surfaced that the disbursement of funds was done in a questionable manner.

The NPP government announced this week it was initiating a fresh investigation and named retired Supreme Court Judge Pradeep Jayathilaka to head a three-member committee that will examine alleged irregularities that took place in providing financial assistance to the religious places for various CCF activities during the period from 2017 to 2020. The decision to appoint the committee was made at the 223rd Governing Council meeting of the CCF, and Cabinet approval for it was given this week.

Mr. Premadasa launched the Sisu Daham Sevana programme under which steps were to be taken to construct dhamma school buildings at 500 temples which face a dearth of resources. Under the programme, CCF was to grant four million rupees for each building, with a three-month period given to complete the work.

However, after a new government took office in 2020 under Gotabaya Rajapaksa’s presidency, allegations surfaced that the CCF monies had been misused or misappropriated. A Prime Ministerial Committee appointed in 2020 claimed it had found that Rs. 11 billion was misappropriated during the three-year period from 2016 to 2019. The committee headed by retired High Court Judge Gamini Sarath Edirisinghe found withdrawals from fixed deposits and loss of interest for those funds caused a loss of Rs. 2.6 billion, while Rs. 753 million was spent without approval for construction purposes under the “Sisu Daham Sevana” programme.

There were also allegations of other instances where the CCF funds were misused during the yahapalanaya government. Akila Viraj Kariyawasam, who, as the education minister from 2015 to 2019, also faced allegations for misusing CCF funds by distributing Rs. 500 million among 1,000 temples around the country, without following the proper procedures. The majority of the money went to temples in the Kurunegala District, the district he represented.

The matter was referred to the Commission to Investigate Allegations of Bribery or Corruption, but Commission officials informed COPE when they were summoned before it that it was ‘decided not to proceed with the matter as there was insufficient information to act in line with the Bribery Act.”

However, with the renewed interest and enthusiasm with which the Commission has been opening old files, this too is likely to be among those that will face a fresh probe. For Mr. Premadasa, a decision taken by him during his brief tenure as a Cabinet minister could place further obstacles in his political path.

This move also seems an obvious attempt to put Mr. Premadasa under pressure and shift attention away from the SJB’s growing attacks on the government over many issues, including what is emerging to be a major scam with regard to the release of a large number of containers from the Colombo Port without subjecting them to proper checks.

Opposition slams CID summoning
MPs regarding container release

The controversy over the release of high-risk containers from the port also led to angry exchanges in Parliament this week between government and opposition MPs. SJB Kurunegala District MP Dayasiri Jayasekara told Parliament on Friday that he had raised a matter of privilege with the Speaker over the Criminal Investigation Department (CID) summoning several opposition MPs who have made statements regarding the controversial release of the containers. He claimed the MPs were being summoned over comments they had made at various news conferences on the issue and alleged them being summoned to the CID to record statements over their comments amounted to attempts to stifle their freedom of expression. He said the matter showed that law enforcement agencies in the country had become heavily politicised under the NPP government. Independent MP Ramanathan Archchuna, meanwhile, had been summoned and questioned over a statement he made in Parliament, which should be protected by parliamentary privilege, said Mr. Jayasekara. He also objected to the Speaker forwarding his privilege issue to the Acting Inspector General of Police for an explanation without first allowing him to read it out in the House. MP Archchuna, meanwhile, described him being questioned over comments he made in Parliament as “a joke.”

Chief Government Whip Nalinda Jayatissa, however, noted that MP Archchuna had alleged that weapons had been smuggled in the containers that were released, and as such, it was a matter of national security. “Whether you make such comments inside or outside Parliament, when it becomes a matter of national security that affects the lives of the people of this country, it is your responsibility to pass on the information you have to the police and the public. As such, there is no need to panic. Don’t hide behind parliamentary privilege,” he told the opposition.

There was a heated exchange after Mr. Jayasekara again alleged that House Leader and Transport, Highways, Ports and Civil Aviation Minister Bimal Rathnayake and his deputy minister were responsible for the release of the containers.

Minister Rathnayake angrily rejected the allegations. “They first claimed in January that the released containers belonged to the Western Province Governor. Five months later, they alleged I was the one who ordered the release of the containers. If they are so insistent that I was the culprit, all they have to do is to go before any court and prove it,” he challenged the opposition.

The government also pledged this week to soon table the full report submitted by the investigation committee appointed to probe the release of the containers from the Colombo Port in January. This would include all the annexures and other documents. SJB MP Mujibur Rahman had earlier tabled the main report before Parliament. Highlights from the report were published in these columns last week. The investigation committee had found that 309 containers, including red-labelled containers, had been released without subjecting them to physical inspection. The committee’s recommendations include a recommendation to conduct an internal inquiry and take disciplinary action against Customs officers who allegedly ignored recommendations made to conduct physical inspections on a stock of high-risk ‘Red’-labelled containers after scans had detected uncertainties regarding the contents and quantities inside.

Bradman Weerakoon and his record administrative innings with nine Sri Lankan leaders Bradman Weerakoon Bradman Weerakoon, the quintessential public servant who had the rare distinction of serving nine Sri Lankan leaders, including seven prime ministers and two presidents, passed away this week at the age of 94. His was a life well lived and well recorded through his own authorship. In his memoir ‘Rendering unto Caesar,’ published in 2004, Mr. Weerakoon recollected his fascinating journey working under nine Sri Lankan leaders, giving readers an insight into the lives of the men and women who served at the helm of the country. It was a story that only a person of the calibre of Mr. Weerakooon, who had a rare and intimate insight into the inner workings of the government, would have told. In 1992, Mr. Weerakoon published a political biography on the then president Ranasinghe Premadasa titled ‘Premadasa of Sri Lanka.’ Given the turbulent times in the country’s political landscape during Premadasa’s administration, the book was not received with much enthusiasm, though today it remains a publication useful to understand a little more about the life of the country’s second executive president, whose life was cut short by a suicide bomb attack in 1993. Less controversial was a book he wrote titled ‘Kalutara—An Odyssey’, in which Mr. Weerakoon took the reader on a journey to the district of his paternal grandparents and of his late wife, Damayanthi, to discover the real heart of this district, which borders the Colombo district but whose many treasures lie hidden. Born in 1930, Bradman Weerakoon graduated in economics from the University of Ceylon. In 1952, as a Smith-Mundt scholar, he obtained his master’s degree in sociology from the University of Michigan, U.S.A. It was his knowledge in sociology that he used to compile his book on Kalutara and learn the sociology and history of a district which starts at the Panadura Bridge and extends to the Bentara Bridge along 22 miles of coastline and has an interior of about 1670 square miles. In an interview with the Sunday Times on February 5, 2023, he said his parents named him ‘Bradman’ as he was born on October 20, 1930, the day Australian cricket legend Don Bradman arrived in Sri Lanka by ship en route to England to play the Ashes series. He lived up to his name, winning many accolades in his lifetime and going down in Sri Lankan history as one of its most eminent public officials.