No GSP+, no US$ 250,000 export orders

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No GSP+, no US$ 250,000 export orders
September 16, 2010, 12:00 pm
By Hiran H.Senewiratne
Sri Lanka has already lost more than US $ 250,000 placed export orders with the recent withdrawal of GSP plus trade concessions by the European Union, said the Chairman of Daya Group of Companies, Daya Gamage.
"Sri Lanka had the advantage of exporting more than 2,000 items to the EU market without duties up to 15th August. With the removal of the GSP plus facility, we have to pay 9.6 percent tax on all exports to EU, which was earlier borne by the governments in the EU," Gamage told The Island Financial Review.
Gamage, one of the leading businessmen in the country, is involved in diversified business areas, including exports, imports, manufacturing and services, banking and finance and many more.
He said that the second stage of the GSP plus issue was the losing of jobs with industries including garments, ceramics and other sectors on the verge of closure due to the absence of export orders.
However, if the government had a proper strategy and a plan to help the private sector, this crisis wouldn’t have arisen and the other ripple effects of job losses could have been avoided, he said.
"Our economy would have suffered more, hadn’t the Bangladesh labour unrest prevailed," he said.
Due to GSP plus trade arrangement, garment exports to the EU went up by 60 percent from 40 percent of total exports, he said.
"With Sri Lanka’s geographical advantage and the quality maintained and achieved over a long period of time, especially in sectors like garments, thanks to the private sector with better management and skill, we still have hope for the future," Gamage said.
"With an appreciating rupee, high interest rates and increase of internal costs including electricity, water, transport, taxes and service charges, Sri Lanka will not be able to compete with other exporting countries in the region," he said.