Sri Lankan exporters falling under select categories will be able to further benefit from trading with the United Kingdom as the independent trading nation yesterday announced its decision to cut import taxes on several products from some of the world’s poorest nations.
The objective of the move is to boost trade links between the UK and selected developing countries. The effort that will be rolled out under the Developing Countries Trading Scheme includes Sri Lanka.
The island nation falls under the ‘Enhanced Preferences’ trading arrangement along with seven other nations including Pakistan, the Philippines, and Uzbekistan.
“The UK’s new Developing Countries Trading Scheme (DCTS) is one of the most generous sets of trading preferences of any country in the world and will benefit Sri Lanka by boosting the economy and supporting jobs,” British High Commissioner in Colombo Sarah Hulton said.
“The new scheme, which replaces UK GSP, will come into force in 2023 and the UK looks forward to future trading opportunities with Sri Lanka,” she added.
DCTS applies to 65 countries, offering lower tariffs and simpler rules of origin requirements for exporting to the UK. The scheme helps countries to diversify their exports and grow their economies, while British households and businesses benefit from lower prices and more choices.
As per the new government policy response issued by the UK’s International Trade Department, the scheme is launched to harness the power of trade to help developing countries grow and prosper.
“The new scheme offers developing countries one of the most generous sets of trading preferences of any country in the world. The scheme demonstrates the UK’s commitment to building long-term, mutually beneficial relationships with emerging economies that are home to more than 3.3 billion people,” the new policy paper that was released yesterday stated.
DCTS essentially cuts administrative costs for businesses by reducing more tariffs and bringing more countries in the scope of the most generous tariff reductions. It also cuts red tape for developing countries, for example by simplifying rules of origin requirements for the least developed nations.
The policy note highlighted that the scheme includes powers to suspend a country on the grounds of human rights or labour violations, as well as for not meeting their climate change obligations.
Commenting on the scheme, International Trade Secretary Anne-Marie Trevelyan said that as an independent trading nation, the UK is taking back control of its trade policy and making decisions that back UK businesses, help with the cost of living, and support the economies of developing countries around the world.