Sri Lanka eyes stronger US trade ties

Tariff cut brings Sri Lankan exports on par with Bangladesh and Vietnam, especially in apparel

- By CHARUMINI DE SILVA

THE Government yesterday said it is working to unlock broader economic opportunities with the US by focusing on improved market access, enhanced trade facilitation and governance reforms.

On 1 August, the US officially announced that it has further reduced reciprocal tariffs to 20% for Sri Lanka exports, scaling down from a steeper initial proposal.

Sri Lanka had been lobbying for a lower rate after US President Donald Trump in April imposed a 44% reciprocal duty on Sri Lankan exports, a retaliatory response to Colombo’s 88% tariff on select US imports. The rate was later reduced to 30% last month and further to 20% following weeks of high-level negotiations.

Sri Lanka is now among the handful of countries that managed to get a 24% rate cut from the original 44% and its exports are now on par with key regional competitors such as Bangladesh and Vietnam, particularly in the apparel sector, which forms the bulk of US-bound shipments.