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Colombo, July 5 -- The Sri Lankan economy could lose billons of rupees after the European Union (EU) officially announced on Thursday that it was withdrawing from August the preferential trade concessions given to the island nation as it failed to respond to a set of human rights-related conditions laid down by the Commission. Earlier, the EU had threatened to withdraw the Generalized System of Preference Plus (GSP+) trade concessions saying Sri Lanka was not complying on several international covenants signed by the island. The EU expressed regret over Sri Lanka's decision to remain silent on the proposals by the EU for Sri Lanka to obtain a temporary extension of the GSP plus benefits by meeting some conditions. Sri Lanka may lose around hundreds of millions of US dollars in apparel exports a year, due to the end of trade concessions from the European Union from August, a media report quoting an industry official said. The Sunday Times newspaper quoted A Skukumaran, president of the Joint Apparel Exporters Association (JAAF) an industry body as saying that Sri Lanka faced the loss of about 12 per cent of the annual 3.3 billion US dollars in apparel exports. In 2009 Sri Lanka exported 187.2 billion rupees of apparels (1,629 million US dollars at an average exchange rate of 114.9 rupees to the US dollar) to the European Union in 2009 according to official data. "We very much regret the choice of Sri Lanka not to take up an offer made in good faith and in line with the EU commitment to a global human rights agenda. We will however keep the door open for Sri Lanka to return to talks," Catherine Ashton of the EU said in a statement on Monday.In a newspaper interview last week, Sri Lankan President Mahinda Rajapaksa, when asked about the risk of losing trade concessions because of his resistance to EU pressure, Rajapaksa said: "I am not bothered."
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