By: Staff Writer
February 26, Colombo (LNW): Sri Lanka’s fragile export recovery faces a new test as the European Union tightens conditions for continued access to its GSP+ trade concession scheme. At the 27th EU-Sri Lanka Joint Commission session held in Colombo in February 2026, European officials delivered a carefully worded but firm message: preferential access is a conditional contract, not an entitlement. Delivery on reform commitments must be measurable, time-bound and credible.
The warning comes at a sensitive political moment for the Marxist-oriented JVP-led National People’s Power (NPP) administration under President Anura Kumara Dissanayake. While the government has pledged governance reform and anti-corruption measures as part of its economic reset, Brussels has signaled concern about legislative backtracking, policy inconsistency and weak external communication.
Central to EU scrutiny is Sri Lanka’s counter-terrorism framework. The long-criticised Prevention of Terrorism Act is to be replaced by the proposed Protection of the State from Terrorism Act (PSTA). European officials have urged Colombo to narrow the definition of terrorism in line with international standards, warning that overly broad language could criminalise peaceful protest and dissent. Extended detention powers and expansive executive authority remain flashpoints.
Alongside security laws, amendments to the Online Safety Act have been flagged as urgent to safeguard freedom of expression and association. The EU delegation also reviewed progress on reconciliation, human rights, and the functioning of independent bodies such as the Office on Missing Persons.
The stakes are substantial. The EU absorbs more than a quarter of Sri Lanka’s exports. Analysts estimate that a full withdrawal of GSP+ after 2027 could slash export earnings by over $1 billion, hitting apparel and processed fish industries hardest and endangering more than 70,000 jobsmany held by women and low-skilled workers.
Compounding the pressure are tougher criteria for the 2028–2034 GSP+ cycle. Beyond the existing 27 conventions, Sri Lanka must demonstrate effective implementation of additional obligations, including climate commitments under the Paris Agreement, stronger labour inspections under ILO Conventions 81 and 144, and compliance with instruments on disability rights and transnational organised crime.
Although Colombo has ratified many of these treaties, the EU has made clear that ratification without enforcement will not suffice. The reapplication window from 2027 to 2028 will require detailed action plans and legislative alignment to prove domestic compliance.
Government officials insist Brussels maintains a “favourable perspective” on Sri Lanka’s progress. Yet European diplomats privately emphasise that goodwill cannot substitute for results. For the NPP administration, ideological positioning and mixed diplomatic messaging risk undermining economic pragmatism. Without sharper policy coherence and proactive engagement, Sri Lanka could find that political symbolism carries an unexpectedly high trade price