GSP+ should not be tied up with pre-conditions - Chief Justice

Sarath Malalasekera

There have been arrangements that regulated trade, primarily designed to resolve disputes against traders.

The modern commercial law has its roots in the lex mercatoria (Law Merchant) of the middle ages, Chief Justice Sarath N. Silva PC said at the Inauguration of the first ever Conference on International Trade held at the Water’s Edge recently.

The Chief Justice said that during that period merchants travelled with their goods to fairs and markets across Europe and their disputes were settled by special local courts in which the judge and jury would be the merchants themselves. They applied the lex mercatoria as opposed to local law.

Thus the lex mercatoria was an international law of commerce based on the general customs and practice of merchants that were common throughout Europe. Subsequently the lex mercatoria was incorporated into the common law of England.

With the growth of Nation States in the modern period of history national identities strengthened and there ceased to be an international law or practice on trade.

The discriminatory trade policies followed by nations in the early part of the 20th century led to retaliatory action and adverse consequences. As a remedy to this situation muli-lateral systems emerged with the Commonwealth Trade Preference System and soon after World War II.

There was the General Agreement on Trade and Tariff (GATT). Ceylon, as Sri Lanka then known was one of the 23 original members of the GATT.

Being an island located at the centre of sea routes of the Indian Ocean we have been a trading nation from time immemorial, the Chief Justice added.

The Chief Justice emphasised that artefacts found in recent excavations disclose evidence of trade extending to Greece and Rome in the West and to China in the East. “Historical evidence is that this trade was carried out on a mutually acceptable basis without there being conflicts and bloodshed”, he said.

The GATT led to the Uruguay Round of negotiations 1986-1994 which resulted in the birth of the World Trade Organisation (WTO),

Trade Related Intellectual property Rights Regime (TRIPS), the Trade Related Investment Measures (TRIMS) and the General Agreement on Trade and Services (GATS), the Chief Justice said.

The Chief Justice said that the Doha Development Agenda would hopefully address the much disputed issue relevant to the agriculture sector.

The avowed purpose of the Multi-lateral Trade Regime is to establish a globally secure market for goods and services.

In other words to establish a level playing field for international trade, the fundamental question that I would raise, somewhat as a layman is whether there could be a level playing field when the players are not equal.

The developing countries are at a disadvantage. I am aware that there are provisions for exceptions and differential treatment such as the GSP+ system of the European Union.

However, regrettably these preferences are tied up on pre-conditions that relate to political and other legal issues.

International trade does not serve the political authority or government of any country. It serves the economic needs of the people. Therefore when countries are starved of their share of trade it is in fact the already impoverished people of that country who starve.

I would urge the developing nations not to tie-up the grant of preferences to the performance of Governments. Please, tie them to the needs of the suffering people of a country. For instance in the garment sector in Sri Lanka thousands of young girls work long hours for meagre earnings.

If the market is not open in the developing countries to the high quality garments that are produced on a preferential basis the sweat of these innocent workers would turn to tears.

Bureaucrats of these developed countries who as it were with cold steel slash on GSP+ benefits based on performance of Governments should have a more humane approach. They should have the heart to know that Governments will come and go but the people of these countries would continue to suffer.