Deputy Minister of Economic Development Anil Jayantha Fernando said the government is looking to negotiate with the United States, the new trade tariffs on Sri Lankan exports, before they take effect on April 9.
Earlier today, the US imposed a 44% tariff on Sri Lankan goods as part of a broader global policy by President Donald Trump to apply a 10% baseline tax on imports, with higher rates for select countries.
Fernando said the government was aware of the potential tariffs but waited for the official US policy before responding.
“If a country imports more than it exports, that will create a trade deficit. For example, Sri Lanka exports to the US around $3 billion worth of goods while we import $300 million worth of goods. Therefore we have a trade deficit that is beneficial for Sri Lanka,” he explained.
US President Trump issued the executive order imposing a 44 percent tariff on Sri Lankan goods, citing it as a reciprocal measure to what he described as the 88 percent in taxes and trade barriers imposed by Sri Lanka on the United States.
Minister Jayantha said the calculation of the 88 percent in taxes and trade barriers must be verified.
He noted that Sri Lanka has held internal discussions and hopes negotiations will lead to a tariff reduction.
Citing the country’s ongoing recovery and cooperation with the International Monetary Fund, Fernando said the government will present its case based on its current economic challenges.
Deputy Minister Jayantha also acknowledged that the tariffs could negatively affect key exports, particularly apparel and food sectors, and reduce national export revenue.
“If the United States follows a global policy on reciprocal tariffs and we do not have the opportunity to renegotiate the terms, we will have a number of other options. For instance the GSP Plus preferential tariff system . We plan to engage the US in diplomatic talks to build a long-term partnership that fosters better trade and investment policies, benefiting both our nations,” said.
The United States remained Sri Lanka’s largest export destination, accounting for 23% of total merchandise exports. (Newswire)