Even a reduced US tariff poses a major challenge - Ranil urges Govt to act

Over 100,000 jobs, especially in apparel and export sectors, could be at risk due to declining trade revenue

By Yohan Perera  

Even if US President Donald Trump reduces the reciprocal tariffs on Sri Lankan exports to 25%, the impact will still be severe, and Sri Lanka must explore fresh avenues to manage its economic challenges, including the need to begin repaying its restructured debts by 2028, former President Ranil Wickremesinghe warned. 

Stresses that the US tariff plan likely unavoidable.

Calls on the government to treat the situation as an economic emergency  

Highlighting the urgency of the situation, Wickremesinghe said that the US’s planned reciprocal tax policy—now only temporarily delayed by 90 days—will deal a heavy blow to Sri Lanka’s export economy. “President Trump has committed to these tariffs in his manifesto. Even if the rate is set at 25%, Sri Lanka’s exports will suffer. It is not something that can be stopped,” he said in a statement.  

He emphasised that this development, combined with the country’s debt restructuring obligations, poses a serious threat to the economy. “Sri Lanka will need to begin repaying its restructured debts by 2028. We must generate new revenue streams, and the government should treat this as an emergency and develop a concrete plan,” he added.  

Wickremesinghe further warned that the reciprocal taxes will negatively impact Sri Lanka’s balance of trade. “Export revenue will decline sharply, affecting not just the economy but also sectors like apparel and related industries. There are estimates that over 100,000 jobs could be at risk,” he said.  

He urged the government to take proactive steps now; emphasizing that waiting until the crisis worsens would only limit the country’s options.