Sri Lanka should keep its GSP Plus concessions - Financial Times, UK

Walter JAYAWARDHANA

United Kingdom's influential Financial Times in an editorial in no uncertain terms advocated Sri Lanka should continue to enjoy the GSP Plus trade concessions without any break.

In an editorial published in its October 21 issue the Financial Times said, "Trade deals should be a means for poor countries to haul themselves out of poverty, not a tool of foreign policy manipulation by their richer counterparts. Sri Lanka's exporters have used their access to the European market well. They should keep it."

In no uncertain terms the newspaper reminded the European Union, trade restrictions are a legitimate means to isolate the most vile abusers of human rights, particularly when an authoritarian government controls the entire country and its economy. That is not the case here. Sri Lanka is not Burma.

The newspaper said further, "Using trade as a strategic tool makes the global trading system hostage to endless political posturing and negotiating games. Governments should grant trade preferences on simple, fair criteria, largely based on the poverty and vulnerability of trading partners."

Written under the topic, Tigers and Trade; Sri Lanka should keep its special access to EU markets, the following is the full text of the editorial: Given the country's wealth and status, standards in the clothing industry of Sri Lanka are pretty high. It is widely recognized, not least by Victoria's Secret and other Western brands who source there, that its factories are environmentally sensitive and relatively respectful of labour rights. Those standards helped Sri Lanka qualify for special trade access to the European Union four years ago, and have continued to improve.

Yet this week the European Commission threatened to suspend those trade privileges, a decision likely to throw thousands of Sri Lankan garment employees out of work. Confused? The episode risks becoming another triumph for the illogicality of using trade deals to achieve non-trade ends.

The trade deal from which Sri Lanka benefits charges specially low tariffs on imports from developing countries that ratify a grand total of 27 standards and treaties.

Some, such as the labour and environmental standards, are at least somewhat connected to trade - though even here there is a risk that such measures are used as protectionism.

Others, such as the Kyoto protocol (in effect meaningless to any developing country, as they have no obligations under it) and the Cartagena protocol on biosafety, which enshrines the precautionary principle for assessing biotechnology, are aimed more at annoying the US, which does not subscribe to the principles therein.

Sri Lanka is threatened with losing its trade rights because of human rights abuses committed by its government in the course of the conflict with the Tiger rebels. Such violations are well documented and abhorrent. But it is perverse to punish the clothing industry and other exporters for the actions of Security Forces they cannot control. In extremis, trade restrictions are a legitimate means to isolate the most vile abusers of human rights, particularly when an authoritarian government controls the entire country and its economy. That is not the case here. Sri Lanka is not Burma.

Using trade as a strategic tool makes the global trading system hostage to endless political posturing and negotiating games. Governments should grant trade preferences on simple, fair criteria, largely based on the poverty and vulnerability of trading partners. Trade deals should be a means for poor countries to haul themselves out of poverty, not a tool of foreign policy manipulation by their richer counterparts. Sri Lanka's exporters have used their access to the European market well. They should keep it.