Gearing for new trade laws in Sri Lanka
COLOMBO – Everyone was on the same page when it was agreed that the new laws on trade remedy which would protect the local industry were both “tedious and technical.” It surely is, if a seminar to enlighten local businesses held at the Ceylon Chamber of Commerce in Colombo last week was held up as an example.
Even one of the two key speakers, Ms. Gothami Silva, a director at the Department of Commerce, was apologetic after her near hour-long address to the audience most of whom struggled to keep awake as the government official explained the process of how the two pieces of legislation would help the local industry.
“I’m afraid it is a very technical subject,” Ms. Silva said almost contritely. “We need to build more awareness and provide technical resources (so that the full benefits of these two laws can be felt).”
The government recently passed two pieces of legislation, one to provide for the conduct of investigations and the application of safeguard measures on products imported into the country and the second to provide for the investigation and application of Anti-Dumping and Countervailing duties on imported products.
The latter is effectively an Anti-Dumping tax on imported goods at a price lower than their actual value. Potatoes, imported from India, were used as an example by Ms. Silva in her speech. That was one topic I could relate to as such it was not Greek to me – how local potato farmers are hit because the imported spud is cheaper, even if the costs of production was high back in India. It reeks of politics because the Indian government provided subsidies to its farmers so that they could export potatoes to Sri Lanka at a lower price.
Husein Esufally, Chairman of Hemas PLC, summarized the dreary seminar well: “Like others have mentioned today, this is a tedious and technical process and we (the local industry) do not have the technical capacity to benefit from these pieces of legislation. I’m here to understand how these laws will support local industries,” Mr. Esuafally said.
He hoped businesses could “lean on” the industry of commerce for assistance and urged for a close partnership to be built. That will be the case assured Ms. Silva who has only been in charge of the trade division at the Department of Commerce for nine months.
“Without domestic legislation, no WTO member country can make use of these instruments when the need arises,” explained Ms. Silva. “There are a lot of fears over the FTAs (Free Trade Agreements) Sri Lanka will sign with countries and there is worry that with this liberalization, tariffs will come down and the local industry will have no protection.”
The two laws will provide protection, but only if users knew how to properly use them the audience was informed.
While she explained or, tried to explain, the two Acts in the limited time made available to her, Mr.Rajiv Goonetilleke, a senior state counsel in the Attorney General’s Department, explained the legal ramifications.
“These are two timely pieces of legislation as it enables us to protect our industries as well as help consumers. The consumer is concerned with price and quality of products while the producer is concerned about profits and market access.
“With these acts, both importers and exporters can benefit but we need more awareness about what these laws will provide and what it can do in terms of fair trade. This is a very technical subject and we must build up our technical resources,” Mr. Goonetilleke stressed.
Tuli Cooray, Secretary General of the Joint Apparel Association Forum, remarked during the panel discussion that Sri Lanka was a country still trying to come to grips with international trading practices and requirements.
“In a situation like this, how do we get sufficient information to say goods imported into Sri Lanka have a lower value, or if the goods are transshipped, do we have the capacity for that information?
“We must make sure the private sector is ready to use this legislation. But are we ready?” asked Mr. Cooray.