The objective of this study is to analyse the performance of the free trade agreement to date and to highlight the opportunities offered to both partners to increase bilateral trade. The study also highlights some sectors that, if promoted, could potentially increase trade between the two countries. These include Pakistan`s cement and motorcycle industry, as well as Sri Lanka`s garment and apparel industry, tourism and tea industry. In May 2017, Sri Lanka regained the privileges of the European Union`s (EU) Generalised System of Preferences (GSP+) for Sri Lankan exports. GSP+ trade preferences consist of the complete elimination of tariffs on 66% of tariff headings covering a wide range of goods, including textiles and fisheries. The GSP+ programme is subordinated to Sri Lanka`s promotion of human and labour rights and the achievement of sustainable development. Pakistan, Sri Lanka Free Trade Agreement (PSFTA) entered into force on 12 June 2005. Since the entry into force of the agreement, there has been a significant improvement in trade. Pakistan implemented its last phase-out obligation in March 2009, and Sri Lanka now has duty-free market access for more than 4500 products. Sri Lanka also fulfilled all its phase-out commitments in November 2010. Sri Lanka`s exports to Pakistan increased from $26 million from January to May 2010 to $34 million in the corresponding period of 2011, growing by 30.8%. This increase is mainly due to a significant increase in exports such as natural rubber, plant products, shredded coconut, new tires, MDF plates, dried legumes, copra, natural graphite, fabrics, etc. from January to May 2011 compared to the same period in 2010.
Exports of certain products such as cake and other solid residues, sewing threads made from synthetic staple fibres, tea, nutmeg, pepper, rubber strips, coconut oil and its fractions, etc. recorded a decrease from January to May 2011 compared to the same period in 2010. A number of new products have also entered the Pakistani market following the introduction of ALEP. Under ALEP, 2,352 certificates of origin were issued from January to May 2011, compared to 2,166 certificates of origin issued under ALEP issued during the same period in 2010. The 10th meeting of the Pakistan-Sri Lanka Joint Economic Commission is scheduled to take place in Islamabad in July 2011. In this context, a meeting of the Joint Economic Commission (Pre-JEC) between the two countries took place in Colombo in March 2011. During the pre-JEC meeting, the two sides agreed to discuss implementation issues under ALEP at the 10th JEC meeting to create a more favorable environment for trade between the two countries. Broader Economic Cooperation Agreement with Pakistan The Pakistan-Sri Lanka Free Trade Agreement entered into force in July 2005, after being signed in August 2002. Under the free trade agreement, Sri Lankan enjoyed immediate duty-free market access for 206 products. Pakistan, on the other hand, enjoyed duty-free access for 102 products. Further concessions were agreed in November 2010. Sri Lanka has signed free trade agreements (FTAs) with India, Pakistan and Singapore and is currently negotiating a free trade agreement with the PRC.
Describes the trade agreements in which this country is involved. Provides resources for U.S. companies to obtain information on the use of these agreements. The Free Trade Agreement between Singapore and Sri Lanka entered into force on 1 May 2018. The free trade agreement covers: investment, goods, services, trade facilitation, government procurement, telecommunications, e-commerce and dispute settlement. Sri Lanka has abolished tariffs on 50% of tariff items (including tariff items already duty-free), which will gradually increase to 80% in 14 years. Sri Lanka will not reduce or abolish tariffs on the remaining 20% of tariff items. Bilateral trade with Sri Lanka has largely been in Pakistan`s favour since the signing of the free trade agreement. Pakistan`s exports more than doubled between 2005 and 2011, while imports remained relatively constant; Pakistan recorded its largest trade surplus of $287 million in 2011. Exports fell after 2011, reaching $269 million in 2017. Imports, on the other hand, have increased by about 60 percent since 2011, peaking at $103 million in 2017.
Pakistan`s trade surplus with Sri Lanka was $166 million in 2017. The Pakistan-Sri Lanka Free Trade Agreement (ALEPPO) was signed between the two governments in August 2002 and entered into force in July 2005. Sri Lanka enjoyed immediate duty-free market access for 206 products, while Pakistan enjoyed duty-free access to 102 products. .