Sri Lanka seeks U. S. tariff reduction to 20 percent

15 July 2025 08:51 am Views - {{hitsCtrl.values.hits}} 16 Bookmark

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In its fresh attempt for renegotiation of tariffs, Sri Lanka is trying hard to get the current rate reduced from 30 percent to 20 percent for its products to be competitive in the U.S. market, a source familiar trade negotiations said.

U. S. President Donald Trump has slapped a 30 percent tariff on Sri Lanka, a reduction from 44 percent initially proposed.

Though the Sri Lankan government sees it as an achievement, it believes a further reduction is needed to become competitive with other countries in trading with the U. S. under the latest circumstances.

The U.S. keeps time open till August 1 for the countries to negotiate further.

President Anura Kumara Dissanayake chaired a meeting with all the stakeholders last Saturday to discuss the way forward.

At the meeting, he ruled out the possibility of compromising anything that affects the country’s sovereignty in seeking fresh terms for trading with the U.S.

However, the government is now planning to send a team to Washington DC for talks with U.S. trade representatives for a better deal.

“We wish to get the current tariff rate reduced to at least 20 percent. Otherwise, it will be difficult for us to be become competitive.

"At the same time, we have to seek what we should do more for the reduction of trade gap with the U.S. If we allow more and more imports from the U.S. we will have to see the cost impact for consumers here,” the source said.

Sri Lanka exports nearly $ 3 billion worth of items to the U.S. and of that, $ 1.2 billion come from garments.

In April 2025, and President Trump announced reciprocal tariffs on a lot of countries, Sri Lanka being one of them.

The American President soon suspended his tariffs for a 90-day period, giving countries time to negotiate with the U.S.

In the meantime, Sri Lanka is now trying to expedite talks on trade arrangements with other countries, including resumption of talks on the Economic and Technology Cooperation (ETCA) with India.