Rules of Origin under GSP+; Lanka seeks early EC approval | Daily News

Rules of Origin under GSP+; Lanka seeks early EC approval

Minister of Development Strategies and International Trade Malik Samarawickrama yesterday requested the EU delegation to support Sri Lanka to obtain the European Commission’s (EC) approval for a joint submission made by Sri Lanka and Indonesia in order to comply with the GSP+ Rules of Origin for apparel exports.

“There has been a considerable delay on the part of the EC in granting its approval,” he said, adding that ‘this is an important pending issue that we need help from the EU to clear as soon as possible.”

The Minister said, the apparel sector, which accounts for over 60% of exports to the EU, has a serious difficulty in complying with the GSP+ Rules of Origin due to the “double transformation requirement”.

This has been the main cause for a lower level of utilization in apparels. In order to overcome this drawback at least to some extent, the Department of Commerce and the Joint Apparel Association Forum (JAAF) have been working on the Cross-regional Cumulation (with Indonesia) and Extended-Cumulation (with South Korea) facilities.

Sri Lanka’s apparel industry is ethical, green and clean and it has important inclusive growth dimensions, both in terms of geographical coverage across the country and in terms of women empowerment.

Apparel is by far the biggest export to the EU. Given that the Rules of Origin under GSP Plus requires fabric to be sourced from Sri Lanka or from an area that qualifies for regional cumulation in order to qualify for GSP Plus, there will be an increase in demand for fabric sourced from Sri Lankan fabric mills.

The Minister said, with the resumption of GSP+ the value of Sri Lanka’s total exports to the EU market in 2018 has recorded a growth of 5%, from 2017. With GSP plus concessions, the country’s export sector has done better.

The earning from the garment exports to the EU increased by 9 5% in May 2019 on a year to year basis.

GSP+ grants duty free access to the EU market for Sri Lankan products on 66% of the EU tariff lines representing something like 6000 products.

The EU and SL have strong and long-lasting economic, trade and investment relations and EU is Sri Lanka’s largest trading partner with 16% of total trade in 2018, before India (4.2 billion euro) and China (3.9 billion euro)

 


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