Financial Times

Sri Lanka tells IMF: We will protect farmers

The government will under no circumstance withdraw import tariffs on agro-based products which are imposed with a view to safeguard the local farmer; Commerce and Consumer Affairs Minister Ravi Karunanayake told a delegation from the International Monitory Fund last week.

The IMF team including Resident Representative in Sri Lanka Jeremy Carter, Jehangir Aziz, L. Leigh and Natalia A. Koliadina met Karunanayake and clarified protective measures taken by the government against imported agricultural products to support local farmers. They said Sri Lanka's agricultural sector is not competitive enough by any standard.

The minister disputed this position and said Sri Lanka has already achieved self sufficiency in rice which is the country's staple food and noted that a comprehensive crop diversification scheme has been introduced under the National Agricultural Policy to improve the quality of life of the farmer population.

He said that the government is obliged to safeguard the livelihood of 1.4 million farmers and said the protection tariff rates imposed by Sri Lanka is far less than the agriculture subsidies and import taxes on agro-based products available in the western countries.

"Sri Lanka's import taxes on agro-based products are up to the maximum of 20% of the CIF price, which is far more less than the 60% to 70% taxes imposed by the European Union countries," he added.

Karunanayake, according to a ministry press release, was quoted as saying that if the country relaxes or completely withdraws tariffs on agro-based products it will open the doors to dumping of products which is detrimental to local farmers because developed countries continue to provide subsidies and protectionist measures to their farmers and local industry.