Sri Lanka will begin the New Year with inauspicious news coming from US, its biggest export market, that the much sought after General System of Preferences would no longer be available from January 01.
The US embassy in Colombo yesterday broke the bad news through a statement headlined ‘Generalized System of Preferences Program Expires on December 31, 2017’.
It said “The United States Congress did not re-authorize GSP before adjourning for the year. The immediate effect of GSP expiration is GSP eligible imports to the United States from Sri Lanka and other GSP beneficiary countries and territories will be subject to non-preferential duties beginning January 1, 2018.
The United States is proud to serve as the top export market for Sri Lanka. According to the Global Trade Atlas, in 2016, the United States imported $2.8 billion of Sri Lankan goods”.
According to available data in 2014 when Sri Lanka exported US$ 2.5 billion worth of products to US, approximately seven percent or US$ 179 million worth of goods went under the GSP scheme.
The bad news however came amidst the veiled threat issued by the Trump administration against countries who voted last week against the Washington decision to recognise Jerusalem as the Israeli capital. The U.N. body voted 128-9 to declare Trump’s recognition of Jerusalem as Israel’s capital “null and void.” Thirty-five nations abstained.
President Trump warned last Wednesday that the vote could impact “billions of dollars” in U.S. aid.
However sources said the Congressional decision not to renew the GSP scheme had nothing to do with the UN vote.