Hungarian govt. pledges support for SL’S GSP Plus application
PM to leave for Brussels to negotiate GSP Plus
The Hungarian government yesterday pledged to support Sri Lanka’s application for the European Union’s (EU) preferential trade programme the Generalized System of Preferences Plus (GSP Plus), saying that economic integration is essential, despite global trends pointing towards isolation.
“We urge to providing Sri Lanka with the GSP Plus status again,” Hungarian Foreign Affairs and Trade Minister Peter Szijjarto said at the World Export Development Forum held in Colombo yesterday. His comments follow Hungary’s representative to the political economic bloc, EU Parliamentarian Istvan Ujhelyi’s pledge to act as an ambassador for Sri Lanka in the EU, during a visit here this July.
The Swedish and Italian governments have also pledged to support Sri Lanka’s GSP Plus application.
Prime Minister Ranil Wickremesinghe said that he would be heading to Brussels this Sunday to start a dialogue with the EU to regain the GSP Plus, a process which takes eight to 10 months after the submission of the application. Szijjarto said that interregional economic integration is essential during these times, even though local economists are now placing more importance on intraregional trade.
“Because of the recent developments in the world, interregional trade, investments and economic integration have been becoming stronger and stronger and for small countries with open economies, it is in their interests, of utmost significance, to take part in such kind of trade agreements,” he said.
He said that Hungary will be pushing the EU to increasing economic integration with China and India—two countries that are not in the 14-country Trans Pacific Partnership (TPP). “We are very disappointed with the pace of the Transatlantic Trade and Investment Partnership and we envy the Trans Pacific Partnership. We actually want to follow up the developments of the Eurasian Economic Union,” he added.
US Republican presidential candidate Donald Trump is pushing for an isolationist agenda, while Hillary Clinton, despite her current neo-liberal views, is now pushing for the shelving of the Trans Pacific Partnership (TPP) as well, despite initially supporting the agreement. Sri Lankan politicians are attempting to find an avenue to join the TPP as well, since the US absorbed 26.7 percent of Sri Lankan exports in 2015.
The EU too is facing internal opposition to economic integration, according to Szijjarto.
After the UK decided to pull out from the EU recently, the EU is saying that it will not allow the UK to be part of its economic zone without being a member state and is pushing for massive sanctions on the UK to discourage further similar exoduses.
“To be honest, we have a fear that Europe will be lagging behind in this competition. That’s why we urge for more and more free trade agreements,” Szijjarto said.
The EU made up 28.8 percent of Sri Lankan exports in 2015 and the UK market represented 9.8 percent of Sri Lankan exports, which has led Sri Lanka to start negotiations for a separate trade negotiation with its former colonial master, following Brexit. However, even after regaining the GSP Plus, Sri Lanka is likely to enjoy the facility only for three more years after advancing to the GSP Plus ineligible uppermiddle-income status, which is likely to occur next year.