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Who Stands to Lose? The Effects of GSP+ Withdrawal on Sri Lanka’s Exports and Labour Force

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New IPS Publication:

Growing uncertainties on the future of global trade as President Trump seeks to impose reciprocal tariffs make programmes such as the European Union’s Generalised Scheme of Preferences Plus (GSP+) more significant for small exporters such as Sri Lanka. With a reported visit by EU representatives to assess GSP+, it is important to note that in the absence of the current tariff preferences, Sri Lanka will face a tariff increase up to Most Favoured Nation (MFN) levels, likely resulting in export losses and associated negative labour market effects.

IPS’ latest study titled “Who Stands to Lose? The Effects of GSP+ Withdrawal on

Sri Lanka’s Exports and Labour Force,” by IPS Researchers Dr Asanka Wijesinghe, Chaya Dissanayake and Rashmi Anupama estimates the export loss of Sri Lanka due to a hypothetical tariff increase from GSP+ rates to MFN rates.

The study reveals that the tariff hike in the EU–28 will cause an export loss of United States Dollars (USD) 1.23 billion (Bn) or 36.7% of EU–28 bound exports from the base year 2019 exports.

Sri Lanka’s wearing apparel and processing fish sectors will be the hardest hit and may face significant export losses. Moreover, the fall in import demand from the EU–28 will make 4.99% of total industrial employees in Sri Lanka vulnerable to adverse labour market outcomes.

This study also points to the differential effect of GSP+ preference erosion on women and low and medium–skilled workers, who account for 65.65% of vulnerable workers.

Some key highlights from the study are the following:

Although the wearing apparel sector does not utilise the GSP+ fully, the negative effect is large as the EU tariffs can go up by close to ten percentage points in a loss of GSP+ status.

The EU–28 is a major export destination for relatively high–technology products like transformers, accounting for 50% of Sri Lanka’s exports to the world in 2019. Estimates show that after GSP+ withdrawal, Sri Lanka will lose about 10% of exports to the EU–28 in transformers.

Reduced imports from the EU–28 under MFN tariffs will also make 73,574 workers vulnerable, as per the calculations of embedded employment in the imports by the EU–28.

Overall, 4.99% of the employment in the affected sectors will be vulnerable to a tariff increase, including 13.47% of workers in the wearing apparel sector.

The GSP+ preference erosion in the EU–28 market is worrying, with an estimated USD 1.23 Bn or 36.7%

export loss of the base year export value for Sri Lanka. GSP+ withdrawal will dwindle Sri Lanka’s export value while impeding the diversification of Sri Lanka’s export product basket towards products with high technology content.

Sri Lanka has a strong economic incentive to comply with the agreed–upon conventions, which is a conditionality of the tariff preference. Despite the variation in utilisation rates, the export effect of preference erosion will be substantial.

Although Sri Lanka may lose the preference with gradual economic growth, at the current growth stage of Sri Lanka, GSP+ is an important tariff preference in promoting growth and generating jobs for women and low and medium–skilled workers in the formal manufacturing sector. The loss of GSP+ at the growth stage with higher average income is a much more manageable loss, rather than a preference erosion at the current stage of growth.

WHO STANDS TO LOSE? THE EFFECTS OF GSP+ WITHDRAWAL ON SRI LANKA’S EXPORTS AND LABOUR FORCE can be downloaded from < https://www.ips.lk/who-stands-to-lose-the-effects-of-gsp-withdrawal-on-sri-lankas-exports-and-labor-force/>.



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Global regulators convene in Colombo for key IOSCO enforcement and cooperation discussions

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Dignitaries at the wide-ranging discussions.

The Securities and Exchange Commission of Sri Lanka (SEC) successfully hosted a series of high-level meetings of the International Organization of Securities Commissions (IOSCO), bringing together leading securities regulators and enforcement officials from around the world to discuss emerging regulatory challenges, strengthen international cooperation, and enhance collective efforts to combat cross-border securities market misconduct.

The meetings, held at the Hilton Colombo from 13 to 16 October 2026, included sessions of the IOSCO Enforcement and Cooperation Committee and its Screening Group (Committee 4/SG), as well as meetings of the Monitoring Group and the Steering Committee. The event attracted approximately 50 senior representatives from securities regulators and exchanges across several jurisdictions, including Australia, Japan, the United States, the United Kingdom, France, Italy, Canada, New Zealand, India, Germany, Belgium, Singapore, China and Spain, reflecting the global significance of the discussions and the growing importance of international regulatory collaboration.

Welcoming delegates to Sri Lanka, Senior Professor D.B.P.H. Dissabandara, Chairman of the SEC, emphasized the critical role of international cooperation in safeguarding market integrity and investor confidence in an increasingly interconnected financial landscape.

“No regulator can effectively address cross-border misconduct in isolation. The speed with which information, transactions and illicit activities can move across borders requires an equally coordinated and timely regulatory response. Strong international cooperation, effective information sharing and mutual trust among regulators are essential to maintaining fair, transparent and resilient capital markets,” he stated.

The discussions focused on a range of enforcement and cooperation matters, including mechanisms for enhancing cross-border information exchange, strengthening investigative collaboration among regulators, addressing increasingly sophisticated forms of securities fraud and market abuse, and promoting the effective implementation of international standards and best practices. Participants also exchanged experiences and insights on emerging enforcement challenges arising from technological developments, digitalization of financial services, and increasingly interconnected global markets.

IOSCO is recognized as the leading international body that brings together the world’s securities regulators and serves as the global standard setter for securities regulation. Through its policy work and cooperative initiatives, IOSCO plays a central role in promoting investor protection, ensuring that markets are fair, efficient and transparent, reducing systemic risk, and strengthening confidence in capital markets worldwide.

Sri Lanka has maintained a strong and active relationship with IOSCO for more than three decades. The SEC became an Ordinary Member of IOSCO in 1993 and has been a signatory to the IOSCO Multilateral Memorandum of Understanding (MMoU) since 2004. The MMoU is the internationally recognised benchmark for cooperation and information sharing among securities regulators and serves as a critical tool in facilitating cross-border investigations and enforcement actions.

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Pan Asia Bank partners Ideal Motors to offer leasing solutions

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Representatives of both parties are seen exchanging the agreement (Standing from left to right) Officials from Ideal motors: Trevene Ferdinand, AGM - Corporate/Tender; Dinesh Manage, Business Development Manager; Kasun Fernando, General Manager - Commercial Vehicles; Nimisha Welgama, Director – Legal and Corporate Affairs; Officials from Pan Asia Bank: Naleen Edirisinghe, Director/CEO; Yohan Ebell, Head of Retail Credit; Sudharshana Hettiarachchi, Officer in Charge – Leasing; and Kanchana Kannangara, National Sales Manager – Leasing.

Pan Asia Bank recently entered into a one-year Memorandum of Understanding (MOU) with Ideal Motors (Pvt) Ltd, creating a new financing avenue for customers purchasing vehicles from the authorised Mahindra dealer. The strategic partnership will enable customers of Ideal Motors to access leasing facilities from Pan Asia Bank, making vehicle financing more convenient while supporting their mobility and business requirements. The agreement also provides an opportunity for the Bank to expand its leasing portfolio and strengthen its presence in Sri Lanka’s vehicle financing market.

Ideal Motors is the authorised dealer for the Mahindra vehicle range in Sri Lanka, including the Mahindra Bolero CPU Truck and Scorpio Jeep/Pickup. The vehicles cater to a range of requirements, from commercial and business applications to personal mobility, making accessible financing an important part of the purchasing decision.

The Bank’s vehicle leasing facilities are designed to simplify the financing process, with convenient repayment options and professional support to help customers select a solution suited to their requirements. For customers, the arrangement brings vehicle selection and financing closer together, reducing the need to navigate the two processes separately.

“Our partnership with Ideal Motors enables us to bring financing closer to customers at the point of vehicle purchase. We remain focused on providing convenient and flexible leasing solutions that support both personal mobility and the needs of businesses,” said Naleen Edirisinghe, Director/CEO of Pan Asia Bank.

Pan Asia Bank and Ideal Motors will work closely during the one-year partnership to maximise business opportunities and deliver a seamless financing experience to customers. The collaboration is expected to strengthen both organisations’ ability to respond to demand for commercial and personal vehicles while creating greater value for customers.

Yohan Ebell, Head of Retail Credit, Pan Asia Bank, said: “Through this partnership, we aim to make vehicle financing simpler and more accessible, with leasing solutions designed to meet the varied requirements of Ideal Motors’ customers.”

The collaboration also reflects Pan Asia Bank’s commitment to building partnerships that make financial services more accessible and responsive to the needs of individuals and businesses.

Pan Asia Bank has established a growing presence in vehicle financing, offering leasing solutions designed around customer convenience and flexibility. Its leasing proposition is supported by a nationwide branch network and a customer-focused approach, enabling customers to obtain guidance on financing options while completing their vehicle purchase.

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Heritance Hotels and Resorts secures four wins at World Travel Awards 2026

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Heritance Hotels and Resorts has secured four distinguished titles at the World Travel Awards 2026, with three national awards recognising its Sri Lankan properties and an international title for Heritance Aarah in the Maldives.

The three Sri Lankan titles recognise Heritance Tea Factory as Sri Lanka’s Leading Heritage Hotel 2026, Heritance Ahungalla as Sri Lanka’s Leading Luxury Hotel 2026, and Heritance Kandalama as Sri Lanka’s Leading Wedding Hotel 2026. Heritance Aarah was named the Indian Ocean’s Leading All-Inclusive Resort 2026.

Internationally recognised within the global travel and tourism industry, the World Travel Awards celebrate excellence across hotels, resorts, and destinations. Recognition at this level affirms the quality, distinctiveness, and consistency of the experiences delivered by Heritance Hotels and Resorts.

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