By: Staff Writer
March 17, Colombo (LNW): A Sri Lankan delegation is scheduled to visit the United States next month to engage in discussions with the U.S. Trade Office regarding the upcoming reciprocal tariffs set to take effect on April 2, 2025. This visit aligns with the Sri Lankan government’s broader efforts to introduce a national tariff policy and a new Customs Act aimed at boosting exports and achieving a revenue target of $19 billion for the year, according to Foreign Minister Vijitha Herath.
Speaking in Parliament, Minister Herath underscored the urgency of these discussions, emphasizing the need to secure exemptions from the tariffs due to Sri Lanka’s fragile economic condition. He warned that the country could not afford additional financial burdens on its exports and stressed the importance of diplomatic negotiations to mitigate the impact.
This initiative follows U.S. President Donald Trump’s recent address to Congress, where he defended his strict tariff policies and announced reciprocal tariffs on several nations, including Canada, Mexico, China, and India. The policy aims to counteract what the U.S. administration perceives as unfair trade practices.
The United States remains a crucial trading partner for Sri Lanka, having imported $3 billion worth of goods from the island nation last year. Notably, over 70% of these exports were from the garment industry, making the U.S. market indispensable to Sri Lanka’s economy. Minister Herath expressed optimism that Sri Lanka’s ongoing engagement with the International Monetary Fund (IMF) could help secure a waiver from these tariffs.
In addition to official trade discussions, a high-level Sri Lankan business forum will be held in the U.S. next month, featuring representatives from the Finance Ministry, Foreign Ministry, and key business leaders. This forum aims to explore economic relief measures and negotiate possible waivers to lessen the impact of the tariff changes.
The national tariff policy is part of a broader initiative to better integrate Sri Lanka into global trade and enhance the competitiveness of its goods and services. A senior ministry official stated that tariff restructuring efforts would align Sri Lanka’s trade policies with evolving global economic trends. The government aims to create a fairer trading environment by adjusting tariff structures to accommodate technological advancements and market dynamics. Lowering tariffs on raw material imports while maintaining protective tariffs on finished goods is expected to stimulate local industries and promote economic self-sufficiency.
Furthermore, the government has launched the National Export Development Plan 2025–2029 to drive export sector growth. President Anura Kumara Dissanayake, who also serves as the Finance Minister, reaffirmed the commitment to streamlining the tariff regime to benefit exporters. The introduction of a new Customs Act is also underway to facilitate trade and enhance revenue collection.
Meanwhile, opposition lawmaker Dr. Harsha de Silva of the Samagi Jana Balawegaya (SJB) urged the government to act proactively in response to the U.S. tariff policy changes. He stressed the need to protect Sri Lanka’s trade relations with the U.S. and offered his expertise as the head of the parliamentary committee on public accounts.
Economists have warned that increased U.S. tariffs could lead to higher import costs and reduced competitiveness for Sri Lankan exports. This could result in decreased export volumes and revenue losses. To counter these risks, the government plans to introduce a clear, transparent, and predictable tariff framework that ensures exporters can access raw materials at competitive prices.
Deputy Minister of Industry and Entrepreneurship Development Chathuranga Abeysinghe outlined additional strategies, including setting minimum prices for key inputs, reducing production costs in the energy sector, and improving transportation infrastructure. These measures aim to enhance the business environment and attract investment.
A senior economist emphasized the importance of a data-driven, transparent mechanism to evaluate industry requests for tariff adjustments. Such an approach would ensure that businesses and labor groups receive appropriate government support to adapt to the changing global trade landscape.
