Sri Lanka worries for withdrawal of trade benefits by EU

COLOMBO - A decision by the European Union to withdraw preferential trade agreements from Sri Lanka has caused concern among the country’s export-oriented garment sector.

The EU mission in Colombo said the Union decided Monday to temporarily withdraw the preferential tariff treatment, known as its Generalised System of Preferences, which grants preferential access to its markets to countries that pursue good governance and sustainable development.

“This decision follows an exhaustive investigation by the European Commission, which identified significant shortcomings in respect of Sri Lanka’s implementation of three UN human rights conventions relevant for benefits under the scheme,” the statement said.

“The suspension will only take effect in six months’ time, giving Sri Lanka extra time to address the problems identified,” the statement added.

While there was no immediate official reaction, garment sector representatives said the apparel industry would be the worst affected.

“The decision is likely to affect the 170,000-strong workforce in the garment industry which is compelled to compete with other countries,” said Anton Marcus, general secretary of the Free Trade Zone Workers Union.

He said the decision was clearly linked to the government’s failure to protect human rights and workers’ rights.

“We will be talking with the government to see that sufficient steps are taken during the temporary suspension so that we continue to gain the concessions,” said Rohan Masakorale, head of the Joint Apparel Association Forum.

“The garment exporters have already been affected by the global recession and they fear that their orders would be further reduced in the upcoming season,” he said.

Other sectors likely to be affected are exporters of tuna, fresh fruit and vegetable, porcelain items and leather products.

The EU investigation relied heavily on reports and statements by the UN and human rights groups which identified significant shortcomings in respect of Sri Lanka’s implementation of the International Covenant on Civil and Political Rights, the Convention against Torture and the Convention on the Rights of the Child, the EU said.

Sri Lankan ambassador to the EU, Ravinatha Aryasinha, said his government was addressing human rights concerns, such as resettling persons displaced by the country’s civil war, allowing access to refugee camps and releasing former Tamil rebel combatants.

However, other serious human rights abuses were reported during the last stage of the fight against the Liberation Tigers of Tamil Eelam, which ended last year with the rebels’ defeat.

The UN said more than 7,500 civilians were killed in the last months of the civil war, a claim denied by the government.

The country gains an estimated $150 million annually due to preferential tariffs.