27 July 2016 09:55 am
Sri Lanka’s largest listed apparel company, Textured Jersey Lanka PLC (TJL), said that regaining the European Union’s Generalized System of Preferences Plus (GSP Plus) facility will more than make up for any downsides the company will experience through Brexit.
“The upside potential of GSP Plus will certainly outweigh any UK specific implications, in the event they be negative due to currency fluctuations etc.,” TJL Managing Director/CEO Sriyan De Silva Wijeyeratne said in the company’s annual report.
He added that the implications of Brexit are yet to be fully understood.
“(But) we have limited exposure to British market, and are confident about balancing our options as we move forward,” Wijeyeratne added. Sri Lanka is expected to know the results of its GSP Plus application over the next 8-10 months while the United Kingdom is negotiating its terms of exit from the European Union. However, Sri Lanka is only likely to benefit from GSP Plus till 2020 due to transitioning to an upper middle income country. Sri Lanka exported around US$ 3 billion worth of products to the European Union last year, while the exports to the UK made of US$ 1 billion of this figure. Over 80 percent of Sri Lanka’s exports to the UK comprised of apparel.
The government is keen on negotiating a free trade agreement with the UK to ensure that there is no loss of trade volumes. Meanwhile, TJL Chairman Wing Lam said that Sri Lanka will also benefit from new bilateral and regional trade agreements that are likely to be negotiated in the near future.