Foreign Ministry Spokesperson Mahishini Colonne last week said the United States, while agreeing to restore the GSP facility, has also agreed to return the duty paid by Sri Lanka during the period it did not enjoy this facility. She said the US will refund the duty paid by Sri Lanka from 31st July 2013.
The Department of Commerce last week announced that the US President Barack Obama signed into law HR 1295 on June 29, 2015 re-authorizing the US GSP Program to Sri Lanka until 31 December 2017, providing preferential duty free entry into US market for nearly 5000 products from 122 designated beneficiary countries and territories, including Sri Lanka. US importers are eligible to claim the import duty paid by them for the eligible products under the USGSP Program during the lapse in GSP coverage from 31 July 2013 with retrospective effect. Accordingly, Sri Lankan exporters too gain duty free access for eligible products under the US GSP program.
“On behalf of the Government of President Maithripala Sirisena, we thank the US government for re-authorizing this crucial trade facility to Sri Lanka. US is the biggest consumer of Sri Lankan exports in the world as well as Lankan apparels,” said Minister Rishad Bathiudeen and added: “In 2014, US took 24% of total Lankan exports and within this were 43% of our total apparel exports to the world. Since 2010, Lankan exports to US have increased by 59%! The renewed US GSP would help our exports development efforts further.”
The 2014 Lankan exports to US was valued at $2.7 billion. In the same year, apparels consisted of 73% of Lankan exports to US at $1.99 billion. Since 2010, Lankan exports to US has surged by 59% as of 2014 and in comparison to 2013, YoY 8% increase is seen in 2014. Sri Lanka exported a total $4.7 billion apparels in 2014.
Apart from apparels, Sri Lanka’s other leading exports to US in 2014 were rubber tires, plastic based packing materials, rubber gloves, activated carbon, coir products, and rubber floor coverings.
Meanwhile, despite the hype over the restoration of the facility, it is learnt that the expiration of the US GSP scheme on 31 July 2013 or the renewal of the scheme on 29 June 2015 had nothing to do with Sri Lanka.
“The US GSP program is subject to periodic renewal by Congress. This is not a country specific review. The GSP program was most recently extended until 31 July 2013, and congress failed to renew it on the due date, therefore the GSP scheme expired. As a result all 122 GSP beneficiary countries lost duty free access given by the scheme for selected products exported to the United States,” sources said.