European Commission proposes 4-year extension to GSP+

• Current GSP+ scheme to be extended till Dec. 31, 2027, as new arrangement yet to be finalised
• Extension of tariff facility will grant Sri Lanka continued access to EU markets 
• EU acknowledges importance of GSP+ for Sri Lankan exporters 

The European Commission has proposed a four-year extension to the current GSP+ scheme, until December 31, 2027, so that countries such as Sri Lanka do not lose their preferential access in the interim. 
The current GSP+ arrangement was set to expire by the end of this year.  
The proposed extension is a result of the ongoing negotiations between the co-legislators of the European Union (EU) regarding the new GSP+ arrangement, the European Union Delegation in Sri Lanka said. 

The extension of the tariff facility would grant Sri Lanka continued access to the EU markets with the same obligations, the EU Delegation in Sri Lanka added. 
“For Sri Lanka, the GSP+ extension proposal means that, for now, nothing changes – same access to the EU market and same obligation to comply with the 27 international conventions, which are key to ensuring that economic recovery is not just fast but also fair, just and green,” the European Union Delegation in Sri Lanka said in a Twitter update, yesterday. 
It added that as one of Sri Lanka’s largest trading partners, the EU recognises the importance of GSP+ for Sri Lankan exporters.  
Local exporters, especially those in the apparel sector, have been repeatedly urging the government and relevant authorities to step up efforts to ensure that Sri Lanka continues to benefit from the preferential tariff scheme.
Last month, the Joint Apparel Association Forum (JAAF) pointed out that as per its analysis, the apparel sector would incur a combined loss of about US $ 494 million per annum, if Sri Lanka loses the GSP+ scheme. 

Although Sri Lanka is identified as a country with the least use of its preferential market access among all the GSP+ countries, the loss of preferential access would severely impact the apparel sector. 
While the current utilisation rate of the GSP+ by Sri Lanka is about 63 percent, 85 percent of the country’s exports are eligible for tariff reductions under the scheme. 
In 2010, Sri Lanka lost the GSP+ status, due to the country’s deteriorating human rights situation. Nevertheless, this status was restored in 2017. 
The EU was expected to adopt a new cycle of the EU GSP Regulation for 2024-2033, which was to be effective from January 01, 2024, for the next 10 years.