Ceylon Today Editorial

Winning the West

13 January 2017

The European Commission (EC) has proposed the restitution of the lost GSP + facility to Sri Lanka. This was the lead story of this newspaper on its yesterday's edition. After going through the formal process of keeping this restitution open allegedly for four months for any objections, it's therefore more than likely that GSP + will be restituted either in April or March.

Nonetheless, German Embassy's Deputy Chief of Mission Dr. Michael Dohmen speaking at the Sri Lanka-Germany Business Council AGM which was held at a leading Colombo hote on 9 November said, the final outcome will be confirmed between March and May 2017.(Ceylon Today of 10 November, 2016)

Sri Lanka obtained the GSP+ duty free facility in its exports to the European Union (EU), its largest single export market in July 2005, in the aftermath of the December 2004 tsunami, only to lose this concession five years later in August 2010 for the non-investigation of alleged war crimes committed by the Government of Sri Lanka (GoSL) and its agents, especially in the closing stages of its war against LTTE terrorism, which war concluded on 18 May, 2009. The EU is Sri Lanka's largest export market, followed by USA, its second largest market. It may not be wrong to say that the EU is the tail wagging the dog (USA).

In that context, a few days after Dohmen's speech, US Ambassador to Sri Lanka Atul Keshap speaking at the inaugural Sri Lanka-USA Business Council meeting that took place at a Colombo hotel on 29 November said, US-Sri Lanka relations are at an all time high, especially after 8 January 2015. (Ceylon Today's editorial of 1 December, 2016).

Therefore, taking into consideration such developments, it's unsurprising that Sri Lanka is more than on track to once more enjoy the duty free GSP+ facility in its exports to the EU, in a few months, if not in a few weeks.

There is a pattern to the West's benign method of treating Sri Lanka, post 8 January, 2015. Firstly, it was the lifting of the fishery ban in exports to the EU in April, a ban which was imposed in October 2014 for alleged poaching at the 'height' of the Mahinda Rajapaksa regime, a man whom the West treated as being an obnoxious personality.

The fishery ban followed four years after the GSP+ ban. On the other hand, post 8 January, 2015, concrete steps have been taken by the EC, the political arm of the EU, to restore the GSP+ facility, nine months after lifting the fishery ban. And, these may not be the last of such steps taken by the West to support President Maithripala Sirisena and Premier Ranil Wickremesinghe's Unity Government.

After Sri Lanka gained the GSP+ facility in July 2005, it boosted Sri Lanka's garment exports, its single largest merchandise export, as well as fishery, ceramic ware and tyre exports. Though, garments were able to survive despite its loss five years later.

Loss of the GSP + concession meant the loss of export earnings, jobs,investment opportunities and therewith job creation. But the restoration of this may mean the regaining of all of those lost economic opportunities after nearly seven years. The other political hurdle that Sri Lanka has to surmount is 'Geneva and human rights'vis-à-vis the LTTE/Tamil question.

According to the Office of the Human Rights Commission's (OHRC's) website, this issue will once more crop up at the 28th session of its Universal Period Review Working Group to be held in October-November 2017, in Geneva. The bone of contention here is foreign jurists sitting over judgment of Sri Lanka over this issue, to which Colombo, together with Washington, was a co-signatory in October 2015.

Nonetheless, subsequently, both Wickremesinghe and Sirisena have said, there is no need for foreign jurists, though there has been some vacillation by the former on this score. A report commissioned by former President Chandrika Bandaranaike Kumaratunga as the island's Reconciliation Office's head has had however recommended the inclusion of foreign jurists, which report handing over, almost coincided with the EC giving the green light for the restoration of the GSP+ facility.

With the seemingly surprising regime change in the USA after President-elect Donald Trump's victory at the November Presidential Election, Sirisena wrote to the US administration to rescind these investigations involving foreign jurists. When this newspaper asked Keshap what was Washington's response to this plea, an apparently agitated Keshap in reply said, he hadn't studied this plea as he had been travelling. This was on 29 November ('Ceylon Today's' editorial of 1 December, 2016).

Since then, Keshap seems to have gone into hibernation, shunning the public eye. But with Rajapaksa beating the war drums over this issue as he has everything to lose if the Unity Government doesn't topple, it's more than likely that this 'foreign jurists'' question may die a natural death, at least this fall, in Geneva.

Daily News Editorial

A great achievement

13 January 2017

The restoration of the European Union’s “Generalised Scheme of Preferences” (GSP Plus) is one of the most significant diplomatic victories of the Yahapalana Government, on par with its handling of the human rights resolutions at the UN Human Rights Council.

This is great news for our exports sector, especially the apparel industry which accounts for 46 percent of Sri Lanka’s exports to the EU, with the GSP Plus being a trade concession system that allows developing countries to pay less or no duties on their exports to the EU. This gives them vital access to EU markets and contributes to their economic growth. The one-way trade preferences would consist of the full removal of duties on 66% of tariff lines, covering a wide array of products including textiles and fisheries, the EU said.

The mention of the UNHRC in the first paragraph is no coincidence. Sri Lanka lost the GSP Plus status in 2010 during the Mahinda Rajapaksa presidency, due to the UNHRC alleging violations of human rights. The GSP+ trade concessions are linked to a country’s compliance with human rights and labour rights conventions.

When the EU evaluated Sri Lanka in 2014 it found that the country was not adhering to three of the 27 international covenants that a country must abide to qualify for the consideration of GSP Plus. Although the previous Government raised a hue and cry about these conditions affecting Sri Lanka’s sovereignty, they were actually beneficial to all Sri Lankans. Human rights are universal – we must adhere to all HR norms and practices if we are to be a member of the global community. Sri Lanka very nearly became a pariah state because the previous Government’s lackadaisical attitude to human rights and its failure to address any of the concerns raised by the international community.

In restoring the facility, the European Council has said it welcomed the significant advances made by Sri Lanka to restore democratic governance, initiate national reconciliation and re-engage with the international community and the United Nations system while noting that the country still has room for improvement on the HR front.

It was none other than President Maithripala Sirisena who broke the news that the EU was on the verge of re-granting this facility. President Sirisena, Prime Minister Ranil Wickremesinghe and Foreign Minister Mangala Samaraweera deserve plaudits for this achievement that is yet another sign that Sri Lanka is no longer isolated on the global stage.

The restoration of GSP Plus will be a huge boost for the apparel industry, but it is not the only industry that will benefit. There are a variety of other products from flowers to precious metals that come under the purview of GSP Plus. Now these industries face the onerous challenge of making the maximum use of the GSP Plus facility, bearing in mind that Sri Lanka is not the only pebble on the beach.

In fact, some of Sri Lanka’s most fierce competitors in apparel and several other industries in the Asian region also enjoy the GSP or GSP Plus trade concessions. Among them are Afghanistan, Bangladesh, Bhutan, Cambodia, Laos, Myanmar, Nepal, Timor Leste and Yemen. Worldwide, there are eight countries that enjoy the enhanced GSP Plus - Armenia, Bolivia, Cape Verde, Kyrgyzstan, Mongolia, Pakistan, Paraguay and the Philippines. We have to catch up with some of these countries that enjoyed GSP Plus uninterrupted.

This is essential, since the EU is Sri Lanka's biggest export market accounting for nearly one-third of Sri Lanka's global exports. In 2015, total bilateral trade reached euro 4.7 billion. In the same year, even without the GSP Plus, EU imports from Sri Lanka amounted to euro 2.6 billion and consisted mainly of textiles as well as rubber products and machinery. The trade potential with GSP Plus on board is much greater.

But our exporters cannot sit on their laurels even with the GSP Plus back in play. Being a Middle Income country, Sri Lanka mostly does not qualify for many loans and grants from foreign governments. Trade is the best alternative, as exemplified by the famous slogan “trade, not aid”. The Government has begun an urgent mission to intensify exports and trade. Free Trade Agreements are due to be signed with several countries including China. Developing the Colombo and Hambantota Port, as well as the proposed investment zone in Hambantota, will help propel exports which have benefitted by the depreciation of the rupee. Sri Lanka is well on its way to becoming a hub for the SAARC region, but we have to think beyond that.

Sri Lanka has to diversify its exports and reach new markets beyond North America and Western Europe. There are some regions which our exports do not reach at all. More promotional campaigns should be started to popularise Sri Lanka’s exports, especially tea and gem and jewellery. Increasing exports is also the answer to the country’s Balance of Payments concerns. GSP Plus is thus a timely shot in the arm for our export sector which must pursue a vigorous expansion in the coming years.

The Island Editorial

There’s a hole in the bucket ...

13 January 2017

 

Chairman of the National Election Commission (NEC) Mahinda Deshapriya has lamented that the postponement of the local government (LG) polls has adversely impacted democracy, as we reported on Tuesday. One cannot but agree with him. He has said his institution is ready to conduct the much-delayed elections. But, that can be done only after the electoral reforms are ratified by Parliament, he has said. There lies the rub! The government has dismissed as flawed the report submitted by the Asoka Peiris committee which reviewed the recommendations made by the delimitation committee headed by Jayalath Dissanayake.

What we are witnessing is a political version of the evergreen, auditory feast, There’s a hole in the bucket sung by Harry Belafonte and Odetta in their inimitable style. The government is playing Henry and the NEC Liza with the former outwitting the latter. The Sirisena-Wickremesinghe administration is using holes in reports on the delimitation process as a stock excuse to shirk its electoral responsibilities. No amount of arguing will make it solve the existing problems that prevent the country from going to the polls in the foreseeable future.

Pressure is mounting on the government to honour its Geneva commitments. The recently released Consultation Task Force on Reconciliation Mechanisms (CTFRM) report, which calls for the participation of foreign judges in proposed war crimes trials, presages more trouble for the ruling coalition on the political front. President Maithripala Sirisena has done a Pontius Pilate; he avoided a ceremony at the Presidential Secretariat, where the aforesaid report was handed over to former President Chandrika Kumaratunga. But, he cannot absolve himself of the responsibility for the recommendations made by an outfit his own administration appointed. The same goes for the UNP and Prime Minister Ranil Wickremesinghe. Although the President and the PM have rejected the participation of foreign judges, the UNHRC resolution, which their government co-sponsored, provides for that.

The government is in a dilemma. On the one hand, it does not want to antagonise the western bloc by reneging on its Geneva commitments. On the other, it is wary of implementing them for fear of losing votes. Its loss will be the Joint Opposition’s gain.

The EU has restored the GSP Plus and the government is cock-a-hoop though it is wholly inadequate by way of economic relief. Too little, too late! Billions of dollars are needed to stabilise the economy and grant relief to the public if the yahapalana regime is to face an election confidently.

Moreover, the prospect of President Sirisena and Prime Minister Wickremesinghe having to lead the LG polls campaigns of their parties and pitting themselves against each other in the process has evidently filled the ruling coalition and its backers with alarm. For, a fierce clash between the two parties led by their own leaders will have a devastating effect on the joint administration’s unity. Hence, the government is using every trick in the book to avoid the mini polls. Economic woes of the public, aggravated by unconscionable tax, levy and tariff increases, bribery and corruption, cronyism, nepotism, abuse of power and unfulfilled election pledges have also made the mini polls a frightening proposition for the government.

The alleged flaws in the Asoka Peiris committee report have come as a godsend for the government. The entire delimitation review process is sure to start over much to the chagrin of the people waiting to exercise their franchise. It is unbecoming of a regime which came to power promising to usher in good governance to look for excuses to postpone elections for political reasons.

Trying to fix holes in the Asoka Peiris report will be an exercise in futility as the government is determined to delay the delimitation process further. What needs to be done is to ratchet up pressure on the powers that be to hold the LG polls under the PR system while action is taken to rectify the errors in the delimitation process and introduce the promised hybrid electoral system.