By: Isuru Parakrama
April 03, Colombo (LNW): Sri Lanka is set to face significant economic challenges following the United States’ latest round of tariffs, with President Donald Trump announcing steep duties on imports, including a 44 per cent tariff on Sri Lankan goods.
The move, unveiled in a statement from the White House Rose Garden, introduces a baseline 10 per cent tariff on all imports to the US, with certain nations facing considerably higher levies.
Sri Lanka now finds itself amongst the hardest-hit economies, ranking alongside Myanmar and Vietnam, which also face 44 per cent and 46 per cent tariffs, respectively.
Cambodia tops the list with a staggering 49 per cent duty, whilst China is subjected to a 34 per cent tariff.
These measures, according to Trump, are aimed at addressing what he perceives as unfair trade practices that disadvantage American industries and workers.
The announcement has sent shockwaves through global markets, with US stock futures plummeting amid concerns over inflation and corporate earnings. The move also signals a dramatic shift away from decades of global trade liberalisation, raising fears of retaliatory actions from affected nations.
Sri Lanka, which exports approximately 25 per cent of its goods to the US, is particularly vulnerable, as industries such as apparel manufacturing, tea exports, and rubber production could see a significant downturn in revenue.
Speaking on the tariffs, Trump described the measure as a “declaration of economic independence,” insisting that the move would revitalise domestic manufacturing and create jobs for American workers.
However, economic experts caution that the new tariffs could disrupt global supply chains, increase costs for US consumers, and potentially push the world economy closer to recession.
Sri Lanka’s government has yet to release an official response, but industry leaders have voiced concerns about the potential impact on exports.
With garments and textiles forming a large share of Sri Lanka’s exports to the US, manufacturers fear that higher tariffs will reduce competitiveness, leading to order cancellations, factory closures, and job losses.
Sri Lanka is yet to respond to the tariff move, but the economic fallout from these tariffs could be substantial. Export-driven businesses may be forced to explore alternative markets or negotiate for exemptions, whilst policymakers face the challenge of mitigating the financial strain on key industries.
