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Leading News from Sri Lanka ::
The AFP report citing an European Union diplomat said the European ambassadors have taken the decision following the EU Commission's investigation which showed that Sri Lanka has not demonstrated that it has taken the steps that would allow it to retain or regain the GSP+ status.
According to the report, the European ambassadors last week took the decision to suspend the trade privileges. It will be endorsed by the European finance ministers when they meet in Brussels on February 16.
However the suspension will come into effect six months later to allow the manufacturers and traders to adjust to the new rules and to Sri Lankan government a fair opportunity to get the decision reversed.
"We will look to work with Sri Lanka to identify concerted steps and actions which could help us to plot the course together that would enable Sri Lanka to regain GSP+," the report quoted the diplomat.
According to EC, In 2008, EU imports from Sri Lanka under GSP+ totaled 1.24 billion Euros (1.9 billion dollars). The most important import products benefiting of these trade preferences were t-shirts and other clothing items, as well as fisheries products. If they were imported under the standard GSP system Sri Lanka would have paid an additional 78 million Euros in import duties.
However, Sri Lanka's Central Bank said earlier that excessively relying on temporary benefits that are controlled by outside authorities or countries create fundamental and structural problems in the island's economy.
Sri Lanka says there is no valid reason for the European Union's to suspend the GSP+ privilege to Sri Lanka under the present situation in the country but the loss will not have a huge impact to the country.
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Feb 05, Colombo: The European Union has decided to suspend the Generalized System of Preference plus (GSP+) trade facility to Sri Lanka due to the country's poor human rights record, the AFP news agency reported.