Features
Is Sri Lanka serious about benefiting from European Union support?
*EU has been a steady supporter of Sri Lanka since the opening of the EU Delegation in the country in 1995
*Through the GSP+, the EU has unilaterally granted duty free access to about 7,000 Sri Lankan products
*Over-protecting local industries may reduce productivity and competitiveness of Sri Lankan products
by Sanath Nanayakkare
Denis Chaibi, Ambassador, Head of Delegation of the European Union to Sri Lanka and the Maldives had a series of discussions with a number of Sri Lankan authorities recently while he was on an official tour in the country. ‘The Island’ had an interview with Chaibi after he had concluded the round of talks. Below are some excerpts from that interview.
Q.
The EU, a Standards Super Power in the world, has consistently been supportive of Sri Lanka. How can Sri Lanka benefit from that support to build a best-in-class manufacturing infrastructure and receive international acceptance for its products and services in the global market?
A
. Indeed, the EU has been a steady supporter of Sri Lanka. Since the opening of the EU Delegation in the country in 1995, the EU taxpayers have provided roughly one billion Euro in development assistance. All of this in grants, with no significant conditions attached.
With 27 Member States and 450 million customers with high income, we are also the largest market in the world. Through the GSP+, the EU has unilaterally granted duty free access to about 7,000 Sri Lankan products – that’s 66% of the EU tariff lines.
To help Sri Lanka in taking full advantage of these GSP+ opportunities, the EU had also made available over 8 million EUR of grants for trade assistance, with the support of specialised UN agencies such as UNIDO and the International Trade Centre. This cooperation translates into real support for Sri Lanka’s national export strategy, help SME’s to get ready to export and encourage new export sectors. Diversification is important as Sri Lankan exports are still focused on very few products.
Sri Lanka has a number of strengths it can further work on. First is the focus on quality. There are opportunities in producing more quality goods for Sri Lanka to stay competitive in the global arena. To put it simply, many neighbouring countries can produce cheaper, but price is not the only way to stay competitive. Quality is another one.
Second, compared to many countries in the region Sri Lanka has high compliance with international labour and environmental standards. This a competitive advantage! Sri Lanka could move further towards sustainable production concepts such as organic produce, green production and Fair Trade practices. Such practices are highly valued by consumers around the world, and in particular in the EU. And they are ready to pay a premium for such products.
Third, beyond export promotion, Sri Lanka is reflecting on how to attract more investments and offer an attractive business environment. Investors can bring not only capital but also share their know-how and best practices.
Finally, a fourth strength would be to remain open for business! Over-protecting local industries may reduce productivity and competitiveness, meaning that products will be more expensive for Sri Lankans, and the possibilities to export will be limited as neighbours will produce better products for a cheaper price. Sri Lanka has a great opportunity to further develop its position as a regional trading hub and major trans-shipment centre. Yet, closing borders to imports is not conducive to these objectives.
Sri Lanka could look at coconut-based products which could be produced in Sri Lanka in the most effective and competitive way. Since the volume of production cannot compete with larger producing countries Sri Lanka could invest in niche products with very high added value marketing/branding their uniqueness. The EU supports geographical branding in Sri Lanka such as “Pure Ceylon Cinnamon”, this is one of the many way not only to add value but also offer new market access opportunity.
Q.
What should Sri Lanka do to gain support of the EU to obtain broader export market access?
A
.The EU market is already wide open: GSP+ grants unilateral tariff preferences on a large range of products to Sri Lanka. About €3 billion was imported into the EU from Sri Lanka in 2019 using the GSP+ preferences. This resulted in a positive trade balance for Sri Lanka of 1.5 billion euro in 2019 alone!
There has been impressive export growth in the months following the re-gaining of GSP+ in 2017 and in total, since its reinstatement, Sri Lanka’s exports to the EU have increased by more than 25%; Fisheries exports have literally doubled since the removal of the fish ban and regaining GSP+. Other notable growth sectors include clothing, tea, tyres, gems as well as motor vehicle parts and footwear.
We thus believe that GSP+ has worked and is working well for Sri Lanka. However, GSP+ still offers great future potential for Sri Lankan companies. GSP utilisation rate is currently still relatively low, and concentrated in a few sectors. We hope that this will improve in the future.
The recent reclassification of Sri Lanka as Lower Middle Income country, means that the GSP+ scheme can continue for at least another three years. On the other hand, this also requires Sri Lanka to continue implementing the 27 international Conventions GSP+ is based on – and all have been signed and ratified by Sri Lanka.
Beyond formal market access, it is also key for Sri Lankan exporters to comply with relevant European standards, in particular phytosanitary certificates (an official document required when shipping regulated articles such as plants, plant products or other regulated articles). We therefore support Sri Lanka in setting up relevant laboratories and in training its companies.
Anyone who has shopped for fruits and vegetables over the last year has seen that prices have increased drastically, and part of the reason is due to more concentrated demand and less competition.
European Importers also decide based on quantity and predictability of supply and other consumer requirements. So, Sri Lankan companies should be equipped with strong marketing and sales work force.
Q.
What do you think of the ongoing import ban in Sri Lanka?
A.
The European Union believes that global problems, such as the pandemic and the ensuing economic crisis, can only be solved through global cooperation. We can help ourselves only by working together. For the recovery of the Sri Lankan and global economy, open and rules-based trade is essential as it gives confidence to businesses to invest, and re-start exchanges that bring in employment and revenues.
Sri Lanka is the only country in the world that has recently adopted an outright import ban. We understand that the Government took this decision to solve a dire problem of foreign currencies. The situation is indeed difficult, but as time goes by, the import ban appears less and less as a temporary measure, and more and more as an economic policy that will increasingly prove incompatible with an export drive.
For Sri Lankan companies, it is already getting more difficult to obtain the needed inputs for their production. Even if special provisions allow them to import raw material, the ban simply complicates business and makes producing in Sri Lanka more expensive.
Highly-restrictive trade measures imposed by an import ban also reduces much-needed State revenue from import tariffs and para-tariffs. Overall, I fear that the import ban reduces Sri Lankan exports competitiveness by adding hurdles when importing raw materials, and by reducing shipping options. The legal uncertainty of the measures will reduce Sri Lanka’s ability to attract European investments, which Sri Lanka has been calling for.
Last, but not least Sri Lanka is part of global trade through its membership and compliance with WTO rules. So notification of the decision to the WTO, and explanations on how these measures will be rescinded, are needed.
In short, trade cannot be a one-way street where the EU is opening its market to Sri Lanka, which benefit greatly from it with a positive trade balance, while EU producers cannot have access to Sri Lanka.
Q.
What was the outcome of your recent engagement with Sri Lankan Trade Minister Bandula Gunawardena and Foreign Affairs Minister Dinesh Gunawadena?
A.
We had a very good and open exchange with both Ministers. On trade, we understand from the meetings that the government is keen to continue cooperation with the EU under GSP+ and many other areas. There are a variety of assistance projects in the pipeline in the area of agriculture, the justice sector and in terms of COVID-19 response. We also agreed with the Foreign Minister to soon resume our formal political consultations through an EU-Sri Lanka Joint Commission and working groups on development, human rights and trade.
Q.
Did you have a dialogue with President Gotabaya Rajapaksa?
A.
Yes, of course. The last time all EU Ambassadors met President Rajapaksa was in June. We shared our concern about the import-ban but also discussed more broadly current challenges of the country and how we can work together to tackle them. This also included discussion about possible EU support in agricultural development, including cold storage facilities.
Features
US’ drastic aid cut to UN poses moral challenge to world
‘Adapt, shrink or die’ – thus runs the warning issued by the Trump administration to UN humanitarian agencies with brute insensitivity in the wake of its recent decision to drastically reduce to $2bn its humanitarian aid to the UN system. This is a substantial climb down from the $17bn the US usually provided to the UN for its humanitarian operations.
Considering that the US has hitherto been the UN’s biggest aid provider, it need hardly be said that the US decision would pose a daunting challenge to the UN’s humanitarian operations around the world. This would indeed mean that, among other things, people living in poverty and stifling material hardships, in particularly the Southern hemisphere, could dramatically increase. Coming on top of the US decision to bring to an end USAID operations, the poor of the world could be said to have been left to their devices as a consequence of these morally insensitive policy rethinks of the Trump administration.
Earlier, the UN had warned that it would be compelled to reduce its aid programs in the face of ‘the deepest funding cuts ever.’ In fact the UN is on record as requesting the world for $23bn for its 2026 aid operations.
If this UN appeal happens to go unheeded, the possibilities are that the UN would not be in a position to uphold the status it has hitherto held as the world’s foremost humanitarian aid provider. It would not be incorrect to state that a substantial part of the rationale for the UN’s existence could come in for questioning if its humanitarian identity is thus eroded.
Inherent in these developments is a challenge for those sections of the international community that wish to stand up and be counted as humanists and the ‘Conscience of the World.’ A responsibility is cast on them to not only keep the UN system going but to also ensure its increased efficiency as a humanitarian aid provider to particularly the poorest of the poor.
It is unfortunate that the US is increasingly opting for a position of international isolation. Such a policy position was adopted by it in the decades leading to World War Two and the consequences for the world as a result for this policy posture were most disquieting. For instance, it opened the door to the flourishing of dictatorial regimes in the West, such as that led by Adolph Hitler in Germany, which nearly paved the way for the subjugation of a good part of Europe by the Nazis.
If the US had not intervened militarily in the war on the side of the Allies, the West would have faced the distressing prospect of coming under the sway of the Nazis and as a result earned indefinite political and military repression. By entering World War Two the US helped to ward off these bleak outcomes and indeed helped the major democracies of Western Europe to hold their own and thrive against fascism and dictatorial rule.
Republican administrations in the US in particular have not proved the greatest defenders of democratic rule the world over, but by helping to keep the international power balance in favour of democracy and fundamental human rights they could keep under a tight leash fascism and linked anti-democratic forces even in contemporary times. Russia’s invasion and continued occupation of parts of Ukraine reminds us starkly that the democracy versus fascism battle is far from over.
Right now, the US needs to remain on the side of the rest of the West very firmly, lest fascism enjoys another unfettered lease of life through the absence of countervailing and substantial military and political power.
However, by reducing its financial support for the UN and backing away from sustaining its humanitarian programs the world over the US could be laying the ground work for an aggravation of poverty in the South in particular and its accompaniments, such as, political repression, runaway social discontent and anarchy.
What should not go unnoticed by the US is the fact that peace and social stability in the South and the flourishing of the same conditions in the global North are symbiotically linked, although not so apparent at first blush. For instance, if illegal migration from the South to the US is a major problem for the US today, it is because poor countries are not receiving development assistance from the UN system to the required degree. Such deprivation on the part of the South leads to aggravating social discontent in the latter and consequences such as illegal migratory movements from South to North.
Accordingly, it will be in the North’s best interests to ensure that the South is not deprived of sustained development assistance since the latter is an essential condition for social contentment and stable governance, which factors in turn would guard against the emergence of phenomena such as illegal migration.
Meanwhile, democratic sections of the rest of the world in particular need to consider it a matter of conscience to ensure the sustenance and flourishing of the UN system. To be sure, the UN system is considerably flawed but at present it could be called the most equitable and fair among international development organizations and the most far-flung one. Without it world poverty would have proved unmanageable along with the ills that come along with it.
Dehumanizing poverty is an indictment on humanity. It stands to reason that the world community should rally round the UN and ensure its survival lest the abomination which is poverty flourishes. In this undertaking the world needs to stand united. Ambiguities on this score could be self-defeating for the world community.
For example, all groupings of countries that could demonstrate economic muscle need to figure prominently in this initiative. One such grouping is BRICS. Inasmuch as the US and the West should shrug aside Realpolitik considerations in this enterprise, the same goes for organizations such as BRICS.
The arrival at the above international consensus would be greatly facilitated by stepped up dialogue among states on the continued importance of the UN system. Fresh efforts to speed-up UN reform would prove major catalysts in bringing about these positive changes as well. Also requiring to be shunned is the blind pursuit of narrow national interests.
Features
Egg white scene …
Hi! Great to be back after my Christmas break.
Thought of starting this week with egg white.
Yes, eggs are brimming with nutrients beneficial for your overall health and wellness, but did you know that eggs, especially the whites, are excellent for your complexion?
OK, if you have no idea about how to use egg whites for your face, read on.
Egg White, Lemon, Honey:
Separate the yolk from the egg white and add about a teaspoon of freshly squeezed lemon juice and about one and a half teaspoons of organic honey. Whisk all the ingredients together until they are mixed well.
Apply this mixture to your face and allow it to rest for about 15 minutes before cleansing your face with a gentle face wash.
Don’t forget to apply your favourite moisturiser, after using this face mask, to help seal in all the goodness.
Egg White, Avocado:
In a clean mixing bowl, start by mashing the avocado, until it turns into a soft, lump-free paste, and then add the whites of one egg, a teaspoon of yoghurt and mix everything together until it looks like a creamy paste.
Apply this mixture all over your face and neck area, and leave it on for about 20 to 30 minutes before washing it off with cold water and a gentle face wash.
Egg White, Cucumber, Yoghurt:
In a bowl, add one egg white, one teaspoon each of yoghurt, fresh cucumber juice and organic honey. Mix all the ingredients together until it forms a thick paste.
Apply this paste all over your face and neck area and leave it on for at least 20 minutes and then gently rinse off this face mask with lukewarm water and immediately follow it up with a gentle and nourishing moisturiser.
Egg White, Aloe Vera, Castor Oil:
To the egg white, add about a teaspoon each of aloe vera gel and castor oil and then mix all the ingredients together and apply it all over your face and neck area in a thin, even layer.
Leave it on for about 20 minutes and wash it off with a gentle face wash and some cold water. Follow it up with your favourite moisturiser.
Features
Confusion cropping up with Ne-Yo in the spotlight
Superlatives galore were used, especially on social media, to highlight R&B singer Ne-Yo’s trip to Sri Lanka: Global superstar Ne-Yo to perform live in Colombo this December; Ne-Yo concert puts Sri Lanka back on the global entertainment map; A global music sensation is coming to Sri Lanka … and there were lots more!
At an official press conference, held at a five-star venue, in Colombo, it was indicated that the gathering marked a defining moment for Sri Lanka’s entertainment industry as international R&B powerhouse and three-time Grammy Award winner Ne-Yo prepares to take the stage in Colombo this December.
What’s more, the occasion was graced by the presence of Sunil Kumara Gamage, Minister of Sports & Youth Affairs of Sri Lanka, and Professor Ruwan Ranasinghe, Deputy Minister of Tourism, alongside distinguished dignitaries, sponsors, and members of the media.
According to reports, the concert had received the official endorsement of the Sri Lanka Tourism Promotion Bureau, recognising it as a flagship initiative in developing the country’s concert economy by attracting fans, and media, from all over South Asia.
However, I had that strange feeling that this concert would not become a reality, keeping in mind what happened to Nick Carter’s Colombo concert – cancelled at the very last moment.
Carter issued a video message announcing he had to return to the USA due to “unforeseen circumstances” and a “family emergency”.
Though “unforeseen circumstances” was the official reason provided by Carter and the local organisers, there was speculation that low ticket sales may also have been a factor in the cancellation.
Well, “Unforeseen Circumstances” has cropped up again!
In a brief statement, via social media, the organisers of the Ne-Yo concert said the decision was taken due to “unforeseen circumstances and factors beyond their control.”
Ne-Yo, too, subsequently made an announcement, citing “Unforeseen circumstances.”
The public has a right to know what these “unforeseen circumstances” are, and who is to be blamed – the organisers or Ne-Yo!
Ne-Yo’s management certainly need to come out with the truth.
However, those who are aware of some of the happenings in the setup here put it down to poor ticket sales, mentioning that the tickets for the concert, and a meet-and-greet event, were exorbitantly high, considering that Ne-Yo is not a current mega star.
We also had a cancellation coming our way from Shah Rukh Khan, who was scheduled to visit Sri Lanka for the City of Dreams resort launch, and then this was received: “Unfortunately due to unforeseen personal reasons beyond his control, Mr. Khan is no longer able to attend.”
Referring to this kind of mess up, a leading showbiz personality said that it will only make people reluctant to buy their tickets, online.
“Tickets will go mostly at the gate and it will be very bad for the industry,” he added.
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