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%E2%80%9CExpiry+of+US+GSP+will+have+marginal+impact%E2%80%9D+%E2%80%93+Commerce+Ministry
Friday, 29 December 2017 - 17:53
“Expiry of US GSP will have marginal impact” – Commerce Ministry
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The Ministry of Industry and Commerce says that the expiry of the US Generalized System of Preferences (GSP) has an only marginal impact on Sri Lanka’s exports to the US.
 
The US Embassy in Sri Lanka earlier in the day (Dec. 29) said that the United States’ Congress did not re-authorize GSP before adjourning for the year.
 
 “The immediate effect of GSP expiration is GSP eligible imports to the United States from Sri Lanka and other GSP beneficiary countries and territories will be subject to non-preferential duties beginning January 1, 2018,” the Embassy said.
 
 “What is important to understand is that this non-renewal of US GSP (for 2018) does not affect our US trade in a significant way and impact is even lower when it comes to total national exports. Only one-fifth of our exports to the US could be temporarily impacted by this routine event”, Minister Risath Bathiudeen said.
 
Accordingly, Apparels, Sri Lanka’s leading exports to the US at an annual value of $ 2 Billion is not at all affected since apparel exports to the US do not come under GSP. 
 
Only some other exports, around 20-25% of the total to the US, come under GSP.
 
Most such GSP eligible exports from Sri Lanka to the US are smaller value items such as travel bags, certain leather products, and some pneumatic tyre types.
 
The Ministry added some Sri Lankan exporters don’t claim the GSP entitlement and therefore the actual value of “affected exports to the US” is around one-fifth of total annual exports to the US from Sri Lanka- around 20% at $ 500mn to $ 570mn.
 
Sources from the Department of Commerce confirmed despite the expiration, the issuance of US GSP entitlement certificates by the Department will continue as usual and with changes to the present procedure.
 
 
The GSP entitlement for Sri Lanka and other beneficiary countries could be renewed and returned as soon as the US Congress re-authorizes it at any time.
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