WT/TPR/M/347  
20 January 2017  
(17-0379) Page: 1/32 
Trade Policy Rev iew Body   
1 and 3 November 2016  
  TRADE POLICY REVIEW  
SRI LANKA 
MINUTES OF THE MEETING  
Chairperson: Ms Irene Young (Hong Kong, China)  
CONTENTS  
 
1  INTRODUCTORY REMARKS  BY THE CHAIRPERSON  ................................ .......................  2 
2  OPENING STATEMENT BY  THE REPRESENTATIVE O F SRI LANKA  ................................ .. 4 
3  STATEMENT BY THE DIS CUSSANT  ................................ ................................ ................  8 
4  STATEMENTS BY  MEMBERS  ................................ ................................ ........................  12 
5  REPLIES BY THE REPRE SENTATIVE OF SRI LANKA  AND ADDITIONAL 
COMMENTS  ................................ ................................ ................................ .....................  29 
6  CONCLUDING REMARKS B Y THE CHAIRPERSON  ................................ .........................  32 
 
 
Note: Advance written questions and additional questions by WTO Members, and the replies 
provided by Sri Lanka  are reproduced in document WT/TPR/M/ 347/Add.1  and will be available 
online at http://www.w to.org/english/tratop_e/tpr_e/tp_rep_e.htm.  WT/TPR/M/347 • Sri Lanka  
 
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  1  INTRODUCTORY REMARKS  BY THE CHAIRPERSON  
1.1.  The fourth  Trade Policy Review of Sri Lanka  was held on 1 and 3 November  2016. The 
Chairperson, Ms. Irene Young (Hong Kong, China), welcomed the delegation of Sri Lanka  headed 
by H.E. Mr. Rishad Bathiudeen, Minister of Industry and Commerce ; the delegation from 
Sri Lanka ; and the discussant, H.E. Ambassador Dr  Stephen Ndungu Karau  (Kenya) .  
1.2.  The Chairperson recalled the purpose of the Trade Policy Reviews and the main elemen ts of 
the procedures for the meeting. The report by Sri Lanka  was contained in document 
WT/TPR/G/ 347 and that of the WTO Secretariat in WT/TPR/S/3 47. 
1.3.  Questions by the following delegations had been submitted in writing before the deadline: 
European Union; Canada; Australia; Turkey; New Zealand; Chinese Taipei; Brazil; Singapore and 
Republic of Korea . The following delegations submitted written questions after the deadline: China; 
United States and Malaysia .  
1.4.  Members were  also pleased to have with them the U nited Nations Industrial Development 
Organization which – as agreed by Members earlier – was attending this meeting as observer on 
an ad hoc basis.  
1.5.  At the previous TPR in 2010, Members had commended Sri Lanka for its solid economic 
performance despite a my riad of adverse factors. During the current review p eriod, the country 's 
economy had  shown resilience and had continued to grow at an average annual growth rate of 
6%. However, the fiscal position was weak and seemed  to be getting worse, with public debt r ising 
to 76% of GDP last year. In their adva nce questions, the Chairperson noticed that some Members 
had asked how this problem was to be addressed. Members knew  that the Government had  
started pursuing fiscal consolidation through structural reforms which , among other things, sought  
to increase tax revenues and improve d the operations of state -owned enterprises. In fact, 
Members had already stressed the importance of introducing tax and SoE reforms in the last TPR. 
The Chairperson believed  they would like to learn more about the development on these fronts.  
1.6.  Last time, Members saw the need for Sri Lanka to deepen its regulatory reform and improve 
the business environment. In this TPR, Members raised again questions about the restrictions and 
incentives for f oreign investment. Enactment of the Underutilised Assets Act in 2011 had  also 
prompted some Members to ask about the new expropriation policy for companies and their 
assets. As Sri Lanka 's FDI inflow ran low and at tracting foreign investment became  a matte r of 
priority, it was useful to know how the  Government intended  to address Members ' concerns in this 
regard.  
1.7.  In 2010, noting that Sri Lanka 's exports were concentrated in certain markets and products, 
Members encouraged the country to step up its diversif ication efforts. While some progress had  
been made, agriculture and clothing still account ed for over 70% of exports, and clothing was 
highly reliant on two major export markets. Given that export diversification was an area identified 
by Sri Lanka for Aid -for-Trade assistance, Members wish ed to have more information on the 
Government 's action plan.  
1.8.  With regard to specific trade measures, Members were pleased to note that, s ince the last 
TPR, Sri Lanka had  implemented a customs single window and had accepte d the WTO Trad e 
Facilitation Agreement. It had  also reduced the number of tariff bands from four to three. 
However, some of the concerns that Members had raised six years ago, about Sri Lanka 's tariff 
regime, remain ed unaddressed. For instance, Members  still saw a large number of levies and 
charges in addition to the tariffs, and indeed more tariff lines where the MFN rate exceeded  the 
bound rate. It would be useful to know how these issues would be addressed . 
1.9.  The previous review  had also raised certain que stions regarding: the use of domestic 
preferences in government procurement; enforcement of intellectual property rights; and adoption 
of competition policy leg islation. Six years on, it seemed that Sri Lanka had  continued to use price 
preferences in procu rement and had  not yet introduced any substantial changes to its IP and 
competition regimes. If there was more updated information, the Chairperson  hoped it could  be 
shared with the Members  in this TPR.  WT/TPR/M/347 • Sri Lanka  
 
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  1.10.   The Chairperson encourage d Members to make use of thi s opportunity to discuss in greater 
detail, not only the key issues identified above, but also other issues of interest to them and of 
systemic importance to the multilateral trading system.  WT/TPR/M/347 • Sri Lanka  
 
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  2  OPENING STATEMENT BY  THE REPRESENTATIVE O F SRI LANKA (H.E. MR. RISHAD 
BATHIUDEEN ) 
2.1.  At the outset , let me thank the WTO Trade Policy Review team for their comprehensive report 
on Sri Lanka, also to you , Madam Chair , for your introductory remarks. We appreciate the role 
played by His Excellency Dr. Stephen Ndungu Karau as the discussant.  
2.2.  My dele gation wishes to thank all the M embers who made written questions to us. We have 
receive d around 138 questions from 12 M ember countries. We have already submitted written 
responses to most of the questions and the questions receive d late would be answered shortly.  
2.3.  I consider that the f ourth Trade Policy Review of Sri Lanka at the WTO is taking place at a 
historic moment of my country mainly for two reasons.  
2.4.  Firstly, it takes place under the National Unity Government of Sri Lanka. Th e National Unity 
Government was established for the first time in the history in January 2015 by the coalition of the 
two main political parties in the country. The two main political parties have agreed to work  
together  on a national development agenda up holding democracy and good governance, although 
the two parties have differences in their political ideology. The main objective in forming a National 
Government is to provide a common platform to deliver long term social economic solutions that 
can solve the key problems of the country.  
2.5.  The National Unity Government is in the process of introducing transformative reforms to the 
economy to further align it with the global economic direction while concentrating achievement of 
the Sustainable Development Goal s declared in the agenda of the UN Sustainable Development 
Summit held in 2015.  
2.6.  Secondly, this Trade Policy Review is focusing on the developments in the country after 
ending prolonged civil conflict against terrorism of 30 years in 2009. During the confli ct one -third 
of the country has not been in a position to effectively contribute to GDP growth in the country. 
After the defeat of terrorism fro m the country in June 2009, my G overnment encountered 
enormous challenges in rehabilitating, resettling and guar anteeing sustainable livelihood for the 
conflict affected people in the North and the East of the country.  
2.7.  I myself was a victim of this ruthless terrorism in the country. Although we peacefully lived in 
the northern part of the country , as Muslims  we were  given ultimatum by the terrorists to leave 
the Northern Province within 24 hours. We had to abandon all what we earned and the businesses 
that we ran for many years. We left the Northern Province with a shopping bag of material that we 
can carry. My famil y lived in many years in refugee camps and I managed to represent the m to 
reach the Parliament as a m ember.  
2.8.  The rehabilitation and rebuilding process in my country cost the G overnment dearly both in 
capital and recurrent expenditure which have s ubstantiall y increased and the G overnment had to 
rely on debts from international sources. We are thankful to all those w ho generously assisted 
Sri Lanka in this exercise. At the same time , the Government had to continue its infrastructure 
developments in the country  to create conducive business environment.  
2.9.  Developing its infrastructure to increase its economic potential has  resulted in 
Sri Lanka 's reliance on foreign debt . The official estimate of what Sri Lanka currently owes its 
financiers is  US$65 billion. The country 's debt -to-GDP currently stands around 75% and significant 
portion of all government revenue is currently  going towards debt repayment . 
2.10.   As a result of the above, the G overnment started experiencing fiscal difficulties to meet with 
country 's both development and rehabilitating needs. The fiscal deficit to GDP has increased from 
6.5% in 2011 to 7.5% in 2015. In the light of the above, the G overnment is making every effort to 
consolidate its fiscal position.  
2.11.   We will give priority to en abling an increase in earnings t hrough a policy o f minimizing 
regressive taxes,  increase the ratio of direct and indirect income tax generation in the medium 
term from 80%: 20% to 60%: 40%, strengthening the tax management processes while removing 
tax holida ys and benefits.  WT/TPR/M/347 • Sri Lanka  
 
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  2.12.   Let me now briefly mention about my country and its performance during the period of this 
Trade Policy Review. Sri Lanka is an Island with 65  610 km2 with a population of 21 million. The 
GDP of Sri Lanka is at US$82.2 billion in 2015. The per capita income has increased from US$2744 
in 2010 to US$3924 in 2015 becoming a lower middle income country. Sri Lanka was able to 
maintain its economic growth at an average rate of 6.4% over the period from 2010 to 2015 
despite external pressure arisin g from the global economic slowdown and the domestic economic 
challenges. The services sector is the largest contributor to the GDP having accounted for 60% 
followed by 31% from industry and 9% from agriculture.  
2.13.   The macroeconomic environment supported by the policy directives has been instrumental 
in achieving such economic results. Sri Lanka has been able to achieve many of its millennium 
development goals in the country , particularly eradicating of extreme poverty, primary education 
at 100% level, gender  equality, child mortality by reducing infant mortality by 2/3, maternal 
health by reducing infant deaths 33 to 100,000, combating communal diseases i.e. elimination of 
Malaria from the country and working towards environmental sustainability.  
2.14.   In addition,  Sri Lanka has been able to achieve a literacy rate of 93% facilitating towards 
establishing a knowledge -based work force in the country. Sri Lanka has been leading in many 
social and business development indices in the region. Sr i Lanka has ranked 73 amon g 
144  countries placing it ahead of other emerging economies on global competitiveness index of 
the World Economic Forum. The World Bank Doing Business index has ranked Sri Lanka at 110 out 
of 190 countries.  
2.15.   With regard to import and export trade, Sri La nka maintains a greater openness to 
international trade. My country introduced open trade policies since 1977. The  consecutive 
Governments of Sri Lanka continue to engage in the policy measures towards trade liberalization.  
2.16.   Sri Lanka has been a founding Me mber of GATT and WTO. Sri Lanka i s a country that 
believes in the multilateral trading system for establishing a level  playing field for all its M embers 
in the international trade with due recognition for development needs of developing countries and 
in particular small and vulnerable economies. While appreciating recent outcomes of multilateral 
negotiations and , in particular , outcomes of Nairobi Ministerial, Sri Lanka look s forward to effective 
implementations of the decisions reach ed at this Ministerial.  
2.17.   Flexibilities through Special and Differential Treatments have been widely recognized for 
smaller economies during the DDA process. Further, Ministerial Declaration of MC -10 made in 
Nairobi (Para graph  26) emphasized on such flexibilities for SVEs with the  aim of facilitating their 
fuller integration into multilateral trading system by taking into account the needs of SVEs in all 
areas of negotiations. Sri Lanka seeks such flexibilities and Special and Differential Treatments 
during the process of WTO futur e negotiations.  
2.18.   Let me now refer to trade policy developments in Sri Lanka. With regard to tariffs, 
Sri Lanka 's bound commitments made to the WTO are relatively at a lower level in both agriculture 
and non -agriculture products. With regard to applied rate , currently Sri Lanka maintains three 
bands tariffs at zero, 15% and 30%. Over 56% of tariff lines are at zero duty level. Out of the 
remaining tariff lines, a majority is confined to lower bracket of tariff.  
2.19.   Despite Sri Lanka 's commitments to trade liber alization, a lower tariff structure has force d 
formidable challenges to the G overnment , in particular to the revenue sources.  
2.20.   The global market slowdown and the fluctuation on the global demand for the commodities 
that Sri Lanka trades have increased the c ountry 's vulnerability to external pressures. As a net 
food importing country, the situation has been critically refle cted in the b alance of payment.  
2.21.   The c ountry 's exports which stood at 30% GDP in the year 2000 has decreased to 15% in 
2014. Our total expo rts in 2015 to the world were at US$10.5 billion while imports remained at 
US$19  billion. This is further aggravated due to lower import tariff structure maintained by the 
country. In certain instances, the G overnment has been compelled to adjust its appli ed tariffs to 
manage external vulnerabilities and domestic sensitivities.  WT/TPR/M/347 • Sri Lanka  
 
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  2.22.   I observed that many questions raised by the Members of the WTO were also concentrated 
on these temporary measures. I wish to inform them  that this is a temporary phenomenon and 
those measures are not at the expense of our commitment to the multilateral trading system. At 
the same time, I solicit attention of the WTO Members to assess the development needs of the 
country as a small economy.  
2.23.   The external sector performances during the period of the review have reflected challenges 
encountered in the global trading environment as well as domestic economic concerns. As 
mentioned, the trade deficit in absolute terms has widened during the period reaching over 10% of 
the GDP.  
2.24.   Despite the b enefit of lower expenditure on fuel imports, the slowdown in the growth of 
world demand for Sri Lanka 's exports and resulted declining process have negatively reflected on 
the trade balance. Pressure on the balance of payment due to this significant gap ha s somewhat 
compensated from the remittances to the country by the Sri Lankans working abroad in particular 
in the Middle Eastern region. However, it is necessary for the Government to introduce policy 
directives to ensure exports led growth to the economy.   
2.25.   These developments directed the new Unity Government to embark upon on a new strategy 
of its trade relations with major trading partners and to work on an export -led economic growth 
strategy. In this regard, the new Unity Government has emphasized on the  following areas.  
a. Developing an enabling environment to strengthen the country 's entry into global value 
chain. Exports of apparel from Sri Lanka have been the major industry that contributes over 
50% of the total exports. This sector has joined the global  value chain with developing 
partnership with major distribution channels. The objective of the national unity government 
is therefore, to facilitate similar engagements with regard to other products and services 
areas.  
 
b. Developing competitive business env ironment and facilitating FDI to the country. The 
workforce in Sri Lanka is providing a promising competitive edge for investing companie s in 
Sri Lanka. The G overnment 's objective is to move away from traditional manufacturing 
engagements to knowledge -based industries in the country.  
 
c. Developing strategies to enhance Sri Lanka 's bilateral and regional trade engagements 
thereby diversifying country 's products and markets and integrate into the global value 
chain of production in both goods and services. Sri Lanka is a party to Regional Trade 
Agreements with neighbouring countries, South Asian Nations and Asia -Pacific countries. 
While upholding the country 's commitments to the multilateral trading system, Sri Lanka will 
explore further opportunities for bilate ral and regional tra de with emerging economies. 
Sri Lanka has already initiated negotiations for bilateral FTAs with China and Singapore, in 
addition to its bilateral a greements with India and Pakistan. Sri Lanka believes that this 
approach will provide op portunities to diversify its products and markets. We are hopeful 
that Sri Lanka will also regain GSP+ market access to the EU in the near future.  
 
d. Promoting the country as the economic hub in Asia in developing necessary infrastructure 
for this purpose. Sri Lanka is strategically located connecting East and West via sea and air 
routes. The country 's business environment complemented with educated work force has 
great potential for Sri Lanka to be the economic hub in Asi a. Towards this objective, the 
Government of Sri Lanka has expanded its seaports capacity by establishing a new port in 
the south of the country. Similarly, a new airport has been established. Other facilities such 
as telecommunication, banking system, insurance, and IT infrastructure have b een 
developed. The Chinese silk route of trade is crossing the country and therefore, Sri Lanka 
as the business hub, will encourage trading partners for enhanced engagement.  
 
e. Sri Lanka aims at effective implementation of Trade Facilitation. Sri Lanka, bei ng a country 
open for trade, believes that minimizing trade barriers and reducing transaction cost of trade 
are effective and efficient ways for future development. Sri Lanka has placed great 
importance on the adoption of the Trade Facilitation Agreement. Sri Lanka has ratified the 
Trade Facilitation Agreement and our Instrument of Acceptance has been submitted to the 
Director General of WTO on 31st May 2016. I am pleased to mention here that my country in 
close liaison with the WTO, the World Bank Group, I TC, UNCTAD, World Customs WT/TPR/M/347 • Sri Lanka  
 
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  Organization, UNIDO and the World Economic Forum, is working on an implementation 
programme and our objective is to establish a productive trade facilitation programme in the 
country with the assistance of the above international agencies and donor community.  
2.26.   Last but not least, I would like to mention that the National Unity Government is making 
dedicated efforts aimed at overcoming the challenge the country 's economy is currently 
experiencing. Towards this target, Sri Lanka conti nues to maintain transparent trade and 
investment policies, minimizing non -tariff barriers, facilitating Foreign Direct Investment as a 
measure of attracting capital and technology. Sri Lanka is expected to reach the targets set in the 
2030 Agenda through export -led economic strategy.  
2.27.   Sri Lanka has so far achieved substantial economic progress despite the interrupted 
setbacks experienced due to external vulnerabilities and domestic issues. We are optimistic that 
Sri Lanka as a united country would be able t o overcome all these challenges and improve its 
trading results with all our trading partners.  
2.28.   Once again, I thank all of you for your patience and also the Chair and the WTO Secretariat 
for their valuable contributions. Thank you.  WT/TPR/M/347 • Sri Lanka  
 
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  3  STATEMENT BY THE DIS CUSSANT  
3.1.  I would like to join you  in welcoming the delegation of the Democratic Socialist Republic of Sri 
Lanka led by Honourable Minister  Rishad Bathiudeen, Minister of I ndustry and Commerce to the 
fourth Trade Policy Review of Sri Lanka.  
3.2.  I am pleased to have  been invited, in my own capacity, to part icipate as a discussant at the 
fourth Trade Policy Review of Sri Lanka. I thank the WTO and the Government of Sri Lanka for t he 
reports which have provided us with a good basis for today 's discussions. I also thank  the Chair for 
her introductory remarks as well as the Honourable Minister for his insightful presentation on the 
state of the Sri Lankan economy. I also thank you all for participating in this Trade Policy Review.  
3.3.  Members of the WTO attach a lot of impor tance to the Trade Policy Review process since it 
contributes to achieving greater transparency in, and understanding of, the trade policies and 
practices of Members. The review , therefore, does not only give us the opportunity to discuss and 
understand Me mbers ' policies but also the opportunity to suggest corrective remedies where such 
policies are not friendly and supportive to economic and trade development. We also expect that 
the outcome of this review will contribute to the realization of development goals being pursued by 
Sri Lanka.  
3.4.  My comments as a discussant will focus on three areas. First, the economic environment of 
Sri Lanka du ring the review period, that is  from 2010 to 2015. Second, Sri Lanka 's trade policies 
and practices, and finally I will broadly touch upon developments in key economic sectors.  
Sri Lanka 's Economic Environment from 2010 to  2015  
 
3.5.  Since the last review in 2010, the economy of Sri Lanka has performed relatively well. The 
economy has shown resilience in the aftermath of the glo bal financial crises and following the 
resolution of the internal conflict, growing at an average annual growth rate in real GDP of 6 % 
during the period under review. Growth was mainly driven by tourism, construction, wholesale and 
retail trade, and financ ial services sectors. It can therefore be observed that Sri Lanka 's economy 
has transitioned from a previously predominantly rural -based agriculture economy towards a more 
urbanized economy driven by services.  
3.6.  Since the end of the internal conflict, Sri La nka has been focusing on long -term strategic and 
structural development, as it strives to become an upper -middle -income country. As part of these 
development plans, Sri Lanka launched a "Mahinda Chinthana  – Vision for the Future " in 2010 
which outlines ove rall economic and development policies as well as setting out specific targets  
including for GDP and export growth, and also for structural change to reduce the reliance on 
agriculture in order to focus on development of the services and industrial sectors . Implementation 
of programmes under the new "Vision for the Future " is therefore critical for Sri Lanka to realize its 
long term economic and development objectives.  
3.7.  Trade has continued to play a n important role in the economy. H owever , its contribution h as 
been declining. Trade in goods and non -factor services as a proportion of GDP declined from 55 % 
in 2011 to 48.5 % in 2015. The share of merchandise trade in GDP declined from around 47 % in 
2011 to 36 % in 2015. In contrast, the contribution of services to  the GDP increased to 60 %. These 
changes have been mainly attributed to weak demand in key merchandise export markets and an 
increase in tourism -related activities during the period under r eview. A key challenge that 
Sri Lanka faces is that its trade remai ns concentrated on a few markets and on a few products. 
The EU and the U.S. markets account for more than 55 % of total exports. While exports continue 
to be heavily concentrated in textile and clothing, and agriculture which accounted for over 70 % of 
total exports in 2015. Sri Lanka 's exports are mainly textiles and clothing, tea, rubber, machinery 
and transport equipment, gems and jewellery. Imports are mainly transport machinery and 
equipment, textile fabrics, petroleum products and food stuffs. It would be important to know the 
steps that are being taken by the Government of Sri Lanka towards diversification of exports and 
markets.  
3.8.  With respect to fiscal policy, it is noted in th e Secretariat r eport that weak fiscal position and 
the resulting public debt  overhang continues to constrain growth sustainability and development in 
Sri Lanka. During the period under review, the fiscal deficit increased from 6.5 % of GDP in 2011 to WT/TPR/M/347 • Sri Lanka  
 
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  7.5% in 2015. Likewise, as a result of persistent fiscal deficit, public debt rose  from 71 % of GDP to 
76% during the same period. Sri Lanka needs to tackle fiscal deficit in order to sustain growth and 
meet its long -term growth ob jectives. It is also noted that weak fiscal position has been 
exacerbated by bloated and underperforming sat e-owned enterprises which continue to be a drain 
to the national budget.  
3.9.  In order to address fiscal deficit, Sri Lanka has continued to take steps to enhance tax 
compliance, and to improve tax audit and risk management. Initiatives are also being taken to 
increase the efficiency of the Customs and Excise Departments. I am also pleased to note that 
Sri Lanka has embarked on  a programme of reforming state -owned enterprises to make them 
more efficient and improve their performance. In addition to these initiat ives, Sri Lanka should 
consider an expansion of the tax base in order  to raise more revenu e. It is also important for 
Sri Lanka to ensure that its fiscal policy entail s increasing public investment in order to build up 
physical and social infrastructure fo r long term growth, and improving business environment for 
private investments.  
3.10.   With respect to monetary policy, the Central Bank of Sri Lanka is responsible for formulating 
and implementing the monetary policy whose objective is to achieve economic and pr ice stability. 
The monetary policy framework of Sri Lanka places greater reliance on market based policy 
instruments and use of market forces which have enabled the country to achieve desired 
objectives. For instance, private credit has been growing steadi ly overtime while inflation has been 
maintained at a single digit level. Sri Lanka should therefore continue to implement policy reforms 
aimed at addressing private sector competitiveness and productivity so that monetary policy play s 
an optimal role in ef ficient resource allocation and support s the country 's vision for sustained high 
long-term growth. There is also a need to improved coordination between fiscal and monetary 
policies which is an essential pre -requisite for the achievement of growth, employm ent and price 
stability objectives.  
3.11.   The C entral Bank of Sri Lanka has also been pursuing free floating exchange rate policy 
which has resulted in stabilizing the Sri Lankan rupee with a 2 % band against the U .S. dollar. A 
stable exchange rate is an importan t signalling mechanism to investors regarding the stability of 
Sri Lanka 's macroeconomic environment. Foreign reserves hav e been maintained at around 
3-4 months ' worth of imports which indicates that Sri Lank a is favourably positioned to withstand 
an immed iate external shock to the economy.  
3.12.   Preferential trade agreements have been the cornerstone of  the trade policy regime of 
Sri Lanka as well as the springboard in its participation in th e multilateral trading system. 
Sri Lanka 's preferential trade regime ha s remained unchanged during the review period and it 
continues to provide long -standing reciprocal preferences pursuant to two bilateral agreements 
with India and Pakistan, and two regiona l trade agreements – the Asia -Pacific Trade Agreement 
(APTA), and th e South Asian Free Trade Area (SAFTA) Agreement. Developments during the 
review period included the launch of free trade negotiations with China and the deepening of the 
bilateral relationship with India. There is no doubt that widening the scope of prefer ential trade 
agreements and deepening the existing bilateral arrangements will enhance market access for 
Sri Lanka 's exports.  
3.13.   On investment regime, it is noted that since the end of the internal conflict , Sri Lanka has 
recognized the importance of rebuildi ng the economy and establishing an attractive environment 
for foreign direct investment (FDI). As part of its V ision of 2010, it was recognized that FDI would 
be an important avenue to bring new technology and development in Sri Lanka. In this connection, 
Sri Lanka has strived to implement various policy measures aimed at attracting FDI. For instance, 
the One-Stop-Shop (OSS) has been formally established to expedite the investment approval 
process. However, FDI has not reached desired levels envisaged, and remains at about 2 % of GDP 
and heavily concentrated in infrastructure development and to urism. Some recent government 
policies, such as restricting land purchases by foreigners and utilization of the "Underutilized Asset 
Act", adopted by the parliament in November 2011 to expropriate companies and assets, may 
have sent mixed signals to foreign investors. In addition, Sri Lanka continues to restrict 
investments in key strategic sectors such as tea, coconut, communication and fishing. I am sure 
Members would be interested to know if there are plans to liberalize these sectors including 
removing restriction on the sale of land to foreigners.  WT/TPR/M/347 • Sri Lanka  
 
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  3.14.   Sri Lanka is an active Member of the World Trade Organization (WTO) and has progressively 
and continuously liberalized it s market in order to integrate into the multilateral trading system. 
We welcome the fact that Sri Lanka granted MFN treatment to all its trading partners, made 
proposals to the Doha Development Agenda and participated actively in the regular work of the 
Committees at the WTO. Most notable during the review period was the submission of many WTO 
notifications that pertained mainly to customs valuation, agriculture, import licensing, SPS, TBT, 
TRIMs and TRIPS which demonstrated that Sri Lanka is committed to f ulfilling its WTO obligations , 
including notifications . 
Trade Measures and Practices  
 
3.15.   On trade measures and practices, it is noted from the Secretariat report that the tariff 
regime remained relatively unchanged during the review period, with applied rates  declining 
slightly from an average of 11.5 % in 2010 to 10.3 % in 2016. It is also noted that over 50 % tariff 
lines are duty -free, about 20 % tariff lines have a 15 % duty, and 23 % have a duty of 30 %. The 
structure of applied MFN tariff consists of ad valorem  rates, specific and alternate rates. The 
specific and alternate rates consist of 4 % of tariff lines, and in my observation, this can make the 
trade regime non -transpar ent, complex and unpredictable.  I know Members would be interested to 
know if there are plans to convert non-ad valorem  rates into ad valorem  in order to enhance 
transparency of the tariff regime. In addition to the tariff, it is noted that Sri Lanka applies a 
number of additional levies and charges which significantly increases the cost of i mportation as in 
some cases they can exceed 100 % the C.I.F. Sri Lanka should therefore consider simplifying and 
rationalizing its tariff regime by limiting the number of rates to make import regime more 
transparent and predictable.  
3.16.   It is further noted that  the applied MFN rate exceeded the bound rate for 132 lines in 2016, 
up from 103 lines in 2010. The products affected included, inter alia , tobacco products, alcohol, 
beverages, textiles, carpets and switches. Although the authorities have stated that this  trend was 
as a result of reduction in the number of tariff bands from four to three in November 2015, it 
would be important for Members to know when corrective measures will be taken.  
3.17.   On customs procedures, I would like to commend Sri Lank a for the main d evelopments that 
have taken place in terms of implementation of single window system in January 2016 and the 
ratification and subsequent notification of its acceptation of the WTO Trade Facilitation Agreement. 
Sri Lanka has also notified its Category A com mitments which identified 11 provisions for 
implementation upon entry into force of the Agreement.  
Sectoral Performance  
 
3.18.   Regarding Sri Lanka 's sectoral performance, most developments during the review period 
were witnessed in the services sector which dom inates the economy and accounts for around 60 % 
of the GDP and is responsible for around 45 % of employment. For instance, in the tourism sector, 
developments during the review period included the launching of a new policy and strategy for the 
sector, aligni ng regulations with international standards, and establishing a "One Stop Unit " for 
investment in tourism. In the financial sector, a number of regulatory policies were introduced to 
strengthen the management of the sector which contributed to the growth a nd stability of the 
financial sector. The insurance subsector has undergone substantial liberalization and deregulation 
which has contributed to its expansion, reaching a growth of 15.12 % in total premiums in 2015. 
Although there was no major liberalizatio n in the telecommunication, the sector continued to 
experience significant growth during the review period, mainly due to growth in the mobile 
telephone subsector. There were also developments in  the transport sector particularly in both 
ports and roads in  terms of new investments aimed at improving infrastructure. The reforms being 
undertaken in the services sector are commendable and it is important that Sri Lanka sustain the 
reform process and increase public investments in order to realize the full pote ntial of the services 
sector. Sri Lanka should also diversify its services sector in order to minimize the risk of reliance 
on a few services sectors.  
3.19.   The agriculture sector remains an important contributor to the economy. According to the 
Secretariat repo rt, it accounted for 8.7 % of the GDP and about 28 % of the total employment in 
2015. Unfavourable weather conditions pose a major challenge to the growth of the agriculture 
sector as it impacts negatively on many commodities. However, there is scope for Sri  Lanka to WT/TPR/M/347 • Sri Lanka  
 
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  increase agricultural productivity through upgrading of technology in addition to reviewing land use 
and crop -mix policies.  
3.20.   Manufacturing sector continues to play a significant role in the economy and trade, 
contributing for nearly 20 % of GDP and  about one fourth of total exports. Manufacturing activities, 
however, are concentrated in a few sectors – textiles and clothing sector, rubber and plastic sector 
and food and beverage sector. As part of Sri Lanka 's 2010 Government development policy, 
"Mahinda Chinthana  – Vision for the Future ", the Government set priorities for the industrial sector 
in which it planned to promote diversification and encourage high -valued added production for the 
sector. However, according to the Secretariat report, due to financial and technological constraints, 
the progress has been too slow to make a significant impact in the industrial structure of the 
country. Sri Lanka should strive to implement its industrial policy in order to bring desired changes 
to the sector. Aid  for trade can play an important role in addressing some of the challenges that 
faces the industrial sector.  
3.21.   In conclusion, I believe that my comments will be useful in promoting fruitful and 
constructive discussions on trade policies and practices of Sri Lanka. There is no doubt that some 
positive developments have taken place in a number of areas during the review period and the 
Government of Sri Lanka is on the right path in undertaking appropriate steps aimed at propelling 
the country to the category of  upper -middle income countries. I thank you all for your attention.  WT/TPR/M/347 • Sri Lanka  
 
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  4  STATEMENTS BY MEMBER S 
EUROPEAN  UNION  
4.1.  As acknowledged by both reports, Sri Lanka has performed economically relatively well 
during the review period maintaining an average annual growth ra te in real GDP terms of 6%, 
despite the external pressure arising from the global economic slowdown and the domestic 
economic challenges.  
4.2.  The EU commends the progress made by Sri Lanka following the elections last year and 
welcomes in particular the imple mentation of an ambitious reform agenda that has allowed Sri 
Lanka to make improvements in many areas, including on governance and rule of law.   
4.3.  From the reports, we also learn that trade has played and is bound to play an important role 
in the economy. W ith this in mind, the EU is following with interest the process of reorientation of 
the economy launched by the Government in 2015, which took Sri Lanka on a path of sound, 
dynamic and more open economic policy. In particular, the EU welcomes the Governmen t's policy 
statement presented at the end of last year, announcing Sri Lanka 's commitment to carry out 
reforms to its national trade policy aimed at encouraging investment and facilitating trade, which 
in turn will lead to the economic diversification Sri Lanka is seeking.  
4.4.  The EU praises Sri Lanka 's engagement in the WTO and, in particular, commends Sri Lanka 
for not only having ratified the Trade Facilitation Agreement but for having promptly submitted its 
category A commitments notification.  
4.5.  The EU enjo ys a stron g relationship with Sri Lanka. We have a Partnership Agreement on 
Cooperation and Development that dates back to 1995 and there was a recent important visit of 
Sri Lankan Prime Minister to Brussels.  
4.6.  While trade volume is relatively small in size , Sri Lanka remains an important trading partner 
for the EU. The EU is the number one destination for Sri Lankan exports, accounting for 27% of 
the total trade of Sri Lanka. In 2015, the total trade in goods between the EU and Sri L anka was 
€4.7 billion with a €0.5 billion surplus for Sri Lanka.  
4.7.  We heard the call of Minister on GSP+ status. In July 2016, Sri Lanka submitted its new 
application to EU preferential treatment under the GSP+. The EU is well aware of the economic 
importan ce for Sri Lanka of being granted GSP+, considering that well over 80% of Sri Lanka 's 
exports would be eligible for such preferences. The EU is currently conducting a technical 
assessment of the application and will inform Sri Lanka of its intentions by th e end of November. A 
final decision will be taken by the EU at the very latest by mid -May 2017.  
4.8.  The EU is committed to supporting Sri Lanka on its path to inclusive growth and sustainable 
development also through development assistance. The EU and its Memb er States continue to be 
collectively a leading grant donor to Sri Lanka. During the period 2005 -2015, the EU provided 
close to €500 million in grants and €250 million in concessional loans to Sri Lanka. The allocation 
for the EU -Sri Lanka bilateral develo pment assistance for 2014 -2020 amounts to €210 million. 
Additional funds are available from other EU instruments, including Trade Related Assistance 
currently amounting to €8 million.  
4.9.  The EU welcome s the course Sri Lanka has taken in the developments of i ts trade policy. I 
would only address a couple of issues of concern.  
4.10.   The EU 's main concern regards the excise duties on large -engine vehicles that may go up to 
700% of the value of the actual manufacturer 's price for a 3500 cc engine, or 400% for a smaller  
engine size vehicle of 1999 cc. While these excise duties are not discriminatory per se, as they 
also affect domestic producers, the EU considers that such excise duties are prohibitive and act as 
a deterrent to potential customers.  
4.11.   Second, the EU acknowl edges the positive developments in terms of customs procedures 
that occurred during the period under review and praises Sri Lanka for having already 
implemented a single window system in this context. However, as regards the WTO Customs WT/TPR/M/347 • Sri Lanka  
 
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  Valuation Agreement  (CVA), the EU would like to encourage Sri Lanka to make an additional effort 
to lift burdensome requirements for business.  
4.12.   Sri Lanka, in its report, concludes that the country is poised towards becoming a geo -
economic hub in the Indian Ocean. The EU hope s that this review will help Sri Lanka in its 
endeavor  and remains committed to continue supporting Sri Lanka 's efforts to face socioeconomic 
challenges.  
CANADA  
4.13.   This review comes at an opportune time. The Government of Sri Lanka has demonstrated its 
intent  to pursue meaningful economic reforms. In July, the World Bank provided Sri Lanka with a 
$100 million credit facility to reduce obstacles to private sector competitiveness, establish 
transparent, well -managed public institutions and improve fiscal sustain ability. Indeed, the World 
Bank has called on Sri Lanka to move from a public sector -driven economy to one that can 
harness the full potential of private -sector dynamism.  
4.14.   If successfully implemented, these reforms should help releas e untapped potential in  the 
Sri Lankan economy. Indeed, Sri Lanka 's average annual growth rate was a commendable six per 
cent during the review period, mainly attributable to expansion within the construction, wholesale 
and retail trade, and financial services sectors.  
4.15.   Recently , the country 's precarious financial situation has created headwinds to growth. In 
May, Sri Lanka received an IMF bailout to help meet short -term debt repayments. While this 
relieved pressure in the short -term, Sri Lanka must continue to work to narrow its  budget deficit in 
order to provide long -term economic stability and predictability for businesses, and thereby to 
achieving its full potential for growth.  
4.16.   Another important characteristic of a stable business environment, for both exporters and 
importers,  is transparency in government decision -making and use of public resources. On 
Transparency International 's Corruption Perception Index, Sri Lanka ranks 83 out of 168 countries. 
Clearly, there is room to improve. In this spirit, a transparent, rules -based,  procurement system 
will promote confidence in the use of public resources. Canada looks forward to receiving more 
information about Sri Lanka 's intent to implement to Central Procurement Agency as outlined in its 
2016 national budget.  
4.17.   Positively, Sri Lank a's ranking in the World Bank 's ease of doing business assessment rose 
in 2016 to 107, up six positions from its 2015 rank, with improvements in ease of starting a 
business, dealing with construction permits and obtaining electricity. Canada encourages Sri  Lanka 
to continue making the changes necessary to maintain a predictable and stable business 
environment. Sri Lanka also took an important step in this regard by ratifying the WTO 's Trade 
Facilitation Agreement in May 2016.  
4.18.   Canada is mindful of Sri Lanka 's ongoing efforts to review its macroeconomic policies and to 
formulate a new agricultural policy  with the goal of  making the country self -sufficient in a number 
of primary commodities by 2018 and transforming the sector from subsistence farming to 
agribu sinesses with export market potential by 2020. We trust that these reforms will be 
undertaken in as an inclusive manner as possible.  
4.19.   Our more specific questions and concerns a re shared by a number of other Members in their 
submissions.  These include import ant questions about Sri Lanka 's Technical Barriers to Trade 
regime, including how technical regulations and conformity assessments are established; 
agricultural tariffs and their application, including with regard to special commodity levies; and 
regarding  Sri Lanka 's plan to introduce a new Trade Regulation Act and how this proposed act will 
help facilitate trade.  
4.20.   Finally, Canada notes the important work being undertaken through the Standards and 
Trade Development Facility to improve the competitiveness of  Sri Lanka Spice and Fruit and 
Vegetable sectors. By developing a national standard on Good Manufacturing Practices in the 
cinnamon sector and ensuring proper training for operators along the value chain, Sri Lanka will be 
better positioned to achieving it s goal of reversing the decline in cinnamon exports. Likewise, by WT/TPR/M/347 • Sri Lanka  
 
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  enhancing inspection and certification capacity of quarantine services and training farmers on good 
agriculture practices, the Fruit and Vegetable sector is better prepared to realize its ex port 
potential.  
4.21.   Canada is a committed partner in supporting Sri Lanka 's economic development as it looks 
to continue capitalizing on the dividend of the peace reached in 2009. Sri Lanka has tremendous 
economic potential such areas as tourism, maritime indu stries, renewable energy and 
infrastructure projects. Part of the challenge will be to develop these sectors sustainably and in 
line with the needs and expectations of citizens. Canada considers that sustainability encompasses 
social as wel l as environment al dimensions: for economic growth to be sustainable, the benefits 
must be shared inclusively. To this end, Canada has and will contin ue to invest in projects in 
Sri Lanka that will support inclusive economic development, including increasing the developme nt 
of small -scale agricultural businesses as well as ensuring as greater economic opportunities for 
women.  
4.22.   In closing, it is clear that Sri Lanka has much to be proud of. While work is needed to 
address significant financial challenges, Canada encourages Sri Lanka to continue on a path of 
economic liberalization and to pursue the reforms necessary to allow private sector dynamism to 
drive economic growth. We recognize that this is not always an easy path to follow – Sri Lanka can 
count on Canada 's support through these reforms.  
AUSTRALIA  
4.23.   Australia applauds the ongoing economic reform agenda adopted by Sri Lanka during the 
period of review.  
4.24.   Australia congratulates Sri Lanka on its impressive GDP growth, averaging 6.4 % over five 
years (2010 -2015).  
4.25.   But we not e sustaining this will require a strong focus on macroeconomic stability, removing 
barriers to trade, high and sustained investment in infrastructure and human capital, and 
continued progress in fiscal consolidation and debt reduction.  
4.26.   Australia commends S ri Lanka 's efforts to attract foreign investment, including the 
introduction of a single electronic gateway for exports and imports, simplifying the tariff structure, 
and eliminating quantitative restrictions.  
4.27.   We encourage Sri Lanka to stay the course of d elivering ongoing economic, trade and 
structural reforms.  
4.28.   Obstacles to foreign land ownership, rigid capital controls, and an unpredictable tariff regime 
remain barriers to further Australian trade and investment in Sri Lanka.  
4.29.   We also encourage the G overn ment to continue to push for State Owned Enterprise (SOE) 
reform, and private sector competitiveness.  
4.30.   As part of this review, we hope to gain a greater understanding of Sri Lanka 's ambition for 
its agriculture sector – particularly plans to transform the sector to an agribusiness export industry 
by 2020.  
4.31.   We are also particularly keen to understand how Sri Lanka is seeking to balance revenue 
generation from tariffs and taxes on fine foods and alcoholic beverages; and encouraging the 
development of a cost -effective tourism sector.  
4.32.   Finally, we congratulate Sri Lanka for ratifying the Trade Facilitation Agreement in May.  
4.33.   This Agreement – when implemented – will strengthen global trade and economic growth; 
create jobs; and deliver substantial development benefi ts for WTO Members, including Sri Lanka.  WT/TPR/M/347 • Sri Lanka  
 
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  NEW  ZEALAND  
4.34.   The objective of the Trade Policy Review Mechanism is "to enable a multilateral assessment 
of the effects of policies on the world trading system. "1 It is in this context that New  Zealand sees 
these pro cesses  as a key  opportunity for WTO M embers to better understand other Members ' trade 
policies, including the effects of these policies on the world trading system. We believe that 
Members need to use these reviews in the way that Ministers intended when t hey concluded 
Annex 3 of the Marrakesh Agreement . It is this perspective which has informed New  Zealand 's 
comments and observations in this Trade Policy Review of an important bilateral partner.  
4.35.   New Zealand is encouraged by Sri Lanka 's steady economic per formance since its last 
review in 2010. The national reconciliation process, constitutional reform and policy aimed at 
reconstruction and growth have set Sri Lanka on a good track. Trade has demonstrably had an 
important role in Sri Lanka 's economy, althou gh its increase in recent years has been outpaced by 
Sri Lanka 's growth in GDP. This shows there is still much to be taken advantage of by Sri Lanka in 
this space.  
4.36.   Sri Lanka has benefited from its emphasis on structural economic reforms, including in 
terms of trade policy. These have placed Sri Lanka well to further its economic development and 
New Zealand welcomes Sri Lanka 's stated intention to undertake further action.  
4.37.   New Zealand welcomes Sri Lanka 's key priorities to renegotiate existing trade agreem ents, 
adopt an export promotion strategy, encourage more foreign direct investment, and promote the 
diversification of exports. These measures and the maintenance of a transparent and predictable 
trading environment will contribute to Sri  Lanka 's continued  growth, including through building 
conditions conducive to attracting foreign investment which taken together can be expected to 
have a positive impact on both poverty alleviation and broader development objectives.  
4.38.   In this regard, New  Zealand notes that  the use of mechanisms to encourage Sri Lankan 
export growth, such as Special Commodity Levies, in products including milk powder, has broader 
systemic implications. Needless to say these should be administered in a non -discriminatory way 
so as not to rest rict importation of these same products. New  Zealand also encourages Sri Lanka 
to ensure that any financial assistance provided to the fishing indus try does not contribute to 
over-capacity or overfishing.  
4.39.   Reciprocal Prime Ministerial visits between Sri Lan ka and New  Zealand in 2016 underscored 
the importance of greater trade and investment to increased prosperity. Agricultural cooperation 
was noted to be an important facet of the commercial relationship between Sri Lanka and 
New Zealand; cooperation which i s underpinned by mutually compatible trade policy.  
4.40.   New Zealand welcomes the quality products that are traded between New  Zealand and Sri 
Lanka, such as Sri Lankan tea and cinnamon and New  Zealand dairy products. New Zealand 
appreciates the progress that Sr i Lanka has made in reducing its d airy tariffs and encourages 
Sri Lanka to take the remaining steps necessary to bring its applied tariffs back in line with its 
WTO bindings as a priority.  . 
4.41.   New Zealand emphasises the importance of trade liberalisation for  the effective functioning 
of the WTO rules -based trading system.  New Zealand welcomes Sri Lanka 's active role in WTO 
negotiations, as a fellow WTO member who relies on international trade in agricultural products for 
its prosperity and in this regard we j oin others in encouraging Sri Lanka to update its 
agriculture -related notifications in line with the commitments established through the Agreement 
on Agriculture.  
4.42.   We congratulate Sri Lanka on its selection to be the Coordinator for the Asian developing 
Members group in the WTO for the year 2016. We note the importance of this position, including in 
terms of encouraging the implementation of the Ministerial decisions of the Ninth and Tenth WTO 
Ministerial Conferences in Bali and Nairobi respectively, and co ntinuing to address the ongoing  
                                                
1 https://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm11_e.htm  accessed on 
29 September  2016.  WT/TPR/M/347 • Sri Lanka  
 
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  issues relating to agriculture, Non -Agricultural Market Access (NAMA) and services. New  Zealand 
continues to appreciate working with Sri Lanka in its capacity as Coordinator.  
4.43.   New Zealand also notes that Sri Lanka has partici pated as an observer to the WTO 
Agreement on Government Procurement (GPA) since 2003. In this respect, New  Zealand continues 
to encourage Sri Lanka to align its policies with the GPA 's non -discrimination principles.  
4.44.   We further note the positive reforms in the energy sector and the structural and taxation 
reforms the government of Sri Lanka is taking, particularly with respect to the reform of fossil fuel 
subsidies. This is a very positive development and we encourage Sri Lanka to share with Members 
its expe rience of such reform, including perhaps in the Committee for Trade and the Environment. 
In the meantime, we also encourage Sri Lanka to con tinue these important reforms. The removal 
of fossil fuel subsidies helps levels the playing field for investment in  and uptake of renewable 
energy and associated technology. Such measures will support implementation of Sri Lanka 's 
Energy Empowered Nation development plan.  
4.45.   New Zealand appreciates Sri Lanka 's continued commitment to the multilateral trading 
system and w e welcome the positive steps that Sri Lanka has taken in the  six years since the last 
TPR. 
BRAZIL  
4.46.   Brazil congratulates Sri Lanka for its strong economic performance during the period under 
review. As mentioned in the report by the Secretariat, despite exte rnal chocks such as the global 
financial crisis, Sri Lanka 's GDP expanded on average by 6% per year in real terms during the 
period 2011 -2015. Moreover, the GDP per capita grew more than 25%.  
4.47.   In Sri Lanka 's last Trade Policy Review, our delegation noted wi th great satisfaction the end 
of the internal armed conflict in May 2009. This circumstance provides a much needed opportunity 
to step up economic and institutional reforms to foster the consolidation of the process of national 
reconciliation. Today, Brazi l congratulates Sri Lanka for having taken this opportunity, 
implementing prudent macroeconomic policies that resulted in the curbing of inflation. Indeed, 
inflation declined from 7.5% in 2012 to less than 1% in 2015. Those are encouraging 
achievements in the generation of a stable economic environment, a crucial enabling condition for 
the acceleration of development. We would like, therefore, to recognize and commend Sri Lanka 
for its efforts to implement sound policies so as to guarantee fiscal, monetary and financial 
discipline. We recommend the Sri Lankan Government to persevere in its efforts to improve 
transparency with the creation of an open business environment.  
4.48.   We would also like to highlight and praise Sri Lanka for the ratification of the WIPO 
Marrakesh VIP Treaty, which is an enabling legal inst rument for the international co operation on 
the access to culture for blinds, visually impaired or otherwise print disabled persons. The 
implementation of the Marrakesh VIP Treaty is a high priority for th e Brazilian Government and we 
are looking forward to establishing international networks that can provide accessible reading 
material for those that need them the most.  
4.49.   Bilateral trade flows have more than doubled from 2011 to 2015, even though from a 
relatively modest basis. In 2015, bilateral trade totaled US$169 million. Brazilian exports were 
concentrated in sugar. Sri Lankan exports, for their turn, were concentrated in rubber and textiles. 
The relations between our countries continue to prosper in a c onstructive and open way, as 
demonstrated by the growing flows of bilateral trade, but it is our view that there is still much 
room for improvement. Trade between Sri Lanka and Brazil is yet much below its potential. We 
envisage a growing possibility of do ing business on ethanol production from sugarcane and in 
airspace industry products. We stand ready to do the utmost to work in this direction and intensify 
bilateral trade in co -operation with the Sri Lankan authorities and businessmen.  
4.50.   My delegation than ks Sri Lanka for the reply to the question raised by our delegation.  WT/TPR/M/347 • Sri Lanka  
 
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  SINGAPORE  
4.51.   Singapore and Sri Lanka enjoy a robust trade relationship. Bilateral trade was worth more 
than S$2 billion last year. We believe that bilateral co -operation will continue to gr ow, especially 
with the recent launch of the Sri Lanka -Singapore Free Trade Agreement (SLSFTA negotiations in 
July. The aim is to conclude a modern, comprehensive and high quality Free Trade Agreement 
which complements efforts to boost our respective econo mies.  
4.52.   Sri Lanka 's economic reform taken during the period under review has borne fruit. This is 
evidenced by the impressive annual GDP growth rate of 6%. We note Sri Lanka 's commitment 
towards the sustained long -term growth of its economy, as demonstrated by its efforts to diversify 
exports, reduce reliance on agriculture and develop its services and industrial sectors. Sri Lanka 's 
ongoing modernization of its customs regime is also commendable. For example, a single window 
system was implemented in January  this year, which allows for the submission of information to a 
single electronic gateway and the use of electronic funds transfer or online payments.  
4.53.   We are concerned that the number of applied tariffs exceeding bound rates has increased 
from 103 to 132 l ines since the last review. We call upon Sri Lanka to bring its tariff regime into 
conformity with its WTO commitments as soon as possible. This will bring greater predictability to 
trade.  
4.54.   Sri Lanka is to be commended for having regularly notified its meas ures. We  welcome 
Sri Lanka 's recent ratification of the Trade Facilitation Agreement (TFA) and its acceptance of the 
Protocol amending the TRIPS Agreement last year. We express our appreciation to Sri Lanka for 
having taken on the coordinator role of the A sia-Pacific Group of Developing members.  
4.55.   We thank Ambassador Susiri Kumararatne and his delega tion in Geneva for the close 
cooperation between our two delegations.  
REPUBLIC  OF KOREA  
4.56.   Korea and Sri Lanka have a long history of bilateral economic relationship . The bilateral 
trade reached US$362 million in 2015. Korean companies and business people have been the 
leading foreign investors in Sri Lanka. Although the FDI by Korea to Sri Lanka has been somewhat 
decreased recently, Korea hopes that its economic part nership with Sri Lanka will continue to grow 
and develop in the future.  
4.57.   Turning to Sri Lankan economy 's overall performance, I wish to  note that, as the Secretariat 
report mentioned, it has been successfully overcome the global crisis and has kept growing.  After 
the financial crisis, Sri Lanka demonstrated its economic resilience, with an average annual growth 
rate in real GDP of 6% during the review period. Inflation has been also well controlled, thereby 
declining from 7.5% in 2012 to less than 1% in 2015 . 
4.58.   On the other hand, as the Secretariat r eport also says, the role played by trade has been 
reduced in the economy, as trade in goods and non -factor services declined from the equivalent of 
about 55% of GDP in 2011 to 49% in 2015. While Korea would like to  appreciate Sri Lanka for 
trying not to resort to protectionist measures and for remaining unchanged in general, despite 
harsh circumstances surrounding the Sri Lankan economy, at the same time, we would like to 
request the Sri Lankan Government to take mo re open policies in regard with trade. Its MFN tariff 
rates are still high, particularly in the agricultural sector, which is 24%. There is room for growth in 
services trade. In addition, we believe that the diversification of expert sectors and the 
simpli fication and elimination of additional levies and charges on a variety of export and import 
products would substantially contribute to the growth of trade in Sri Lanka.  
4.59.   After the resolution of the internal conflict, Sri Lanka has become more attractive to foreign 
investors. The Government also recognizes the importance of FDI. However, FDI levels remain 
relatively low, and in 2015, FDI inflows declined and stood at about 2% of GDP, which is below the 
Government 's target of 3% of GDP. Korea would like to req uest Sri Lanka to create a better 
investment environment, by eliminating or modifying potentially investment -restrict policies and 
legal measures, including land ownership restrictions.  WT/TPR/M/347 • Sri Lanka  
 
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  4.60.   Another thing Korea is concerned about is, as many of the previous spe akers pointed out, 
the chronic fiscal deficits experienced by Sri Lanka. Since it is closely related to its trade policy and 
performance in general, Korea is very concerned about it. In this regards, we re -submitted the 
same questions on Sri Lanka 's fiscal  policy, which were raised by Korea in 2010. In this regards, I 
very much appreciate Sri Lanka 's response to Korea 's advanced written questions, including the 
one, related to fiscal deficit, and we will carefully review the response later.  
4.61.   It is also our hope that Sri Lanka will continue to actively participate in helping strengthen 
the WTO multilateral trading system, guided by its rehabilitation program mes as Minister Rishad 
Bathiudeen mentioned in his opening remarks, as well as the long -term strategic blueprint, the 
2010 "Mahinda Chinthana – Vision for the Future " which include many key elements for economic 
growth and trade promotion. With this, I would like to conclude by expressing my sincere 
appreciation to the Sri Lankan delegation for its hard wor k and wish Sri Lanka every success in its 
fourth TPR.  
CHINA  
4.62.   Sri Lanka has maintained a robust growth of 6% in average from 2011 to 2015, and trade 
has continued to play a vital role in its economic development. During the period under review, 
important eff orts have been made by the government of Sri Lanka to liberalize its trade and 
investment regime, with a vision to build Sri Lanka as the trading hub in the South Asian region. 
The TFA ratification of Sri Lanka this year, in which 11 provisions are identif ied in category A, is a 
good demonstration of their strong commitment to trade liberation. Additionally, Sri Lanka has 
launched FTA negotiations with China in 2014, we hope this FTA could be successfully concluded 
as early as possible, and bring benefits t o the people from both countries.   
4.63.   Sri Lanka is a staunching supporter of the multilateral trading system, and an active 
participant in the DDA negotiations. We highly commend the role of our Sri Lanka colleague here 
in Geneva, and look forward to working  more closely with them in the future.  
4.64.   On the bilateral front, China and Sri Lanka maintained sound economic and trade 
cooperation. Bilateral trade is increasing rapidly in the review p eriod, and China has become 
Sri Lanka 's second largest trading partner  and third largest source of foreign investment. Our 
statistics showed that the bilateral trade between China and Sri Lanka reached US$4.6 billion last 
year, and continued to grow by 6% in the period between January and August this year. 
Investment from Ch ina to  Sri Lanka is also accelerating  our accumulated investment in Sri Lanka 
reached US$890 million by the end of last year, and between January to August this year, new 
investment from China has increased 70% on a year -to-year basis. Moreover, China is S ri Lanka 's 
largest tourist source today. From January to August this year, nearly 200,000 Chinese tourists 
have arrived in Sri Lanka, a 32% increase from the same period last year.  
4.65.   Looking ahead, China is willing to step up a more comprehensive cooperatio n with Sri Lanka 
within the framework of the Belt and Road Initiative, and ready to promote the bilateral ties to a 
new level.  
4.66.   China has posed some written questions to Sri Lanka for clarification, and is grateful for the 
replies received, which we will s tudy closely.  
UNITED  STATES  
4.67.   I would like to begin by expressing my G overnment 's best w ishes for the Government of 
Sri Lanka. Under President Sirisena, your commitment to human rights, democracy, and the rule 
of law is noted an d greatly appreciated. We also  note your G overnment 's commitment to the 
progressive adoption of world class trade and investment rules.  
4.68.   This review comes at a historic moment for Sri Lanka. With the end of a long civil war and a 
renewed commitment to democratic values, we see opportuni ty for prosperity to regain and 
consolida te its foothold in your nation.  With enlightened governance, sound economic policies, and 
peace, we see a bright future for all Sri Lankans.  WT/TPR/M/347 • Sri Lanka  
 
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  4.69.   Sri Lanka 's high literacy rates, well established export industries, and c ommitment to 
economic reform provide strong potential for much higher growth rates and employment creation. 
In traditional exports like apparel and agricultural products, there is ample room for growth by 
moving up the val ue chain.  A small but rapidly grow ing IT sector oriented to entrepreneurship 
promises to complement  these existing export giants. Also, with peace restored, t ourism has 
boundless potential.  Finally, Sri Lanka is well placed in its ambition to become a regional services 
hub. 
4.70.   The United Stat es and Sri Lanka have an expanding trad e relationship totaling 
US$3.25  billion in two -way trade in 2015. The United States rem ains Sri Lanka 's largest 
single -country market.  
4.71.   We would like to underscore our regard for Sri Lanka 's commitment to principles of  
openness to international trade an d an investor friendly climate.  In particular, we laud Sri Lanka 's 
goal to adopt world -class trade and investment standards – the first South Asian country to make 
such a commitment. With this in mind, we note, however, t he Secretariat 's observation of the slow 
pace of implementation o f trade and investment reforms.  Sri Lanka has made substantial use of 
import surcharges and other char ges applied mainly on imports. We continue to hope that the 
government 's commitment to ec onomic reform and its desire to establish Sri Lanka as a regional 
services hub – which will require expedited movement of goods, services and workers  into and out 
of the country - will provide increasing opportunities for Sri Lanka to reduce the barriers t o 
imports.  
4.72.   We hope, too, that Sri Lanka is bearing in mind the benefits to its trade that can result from 
binding a greater number of its tariff l ines beyond the current 36.4%. The binding of tariff lines 
makes trade more predictable for your domestic indu stries that require inputs at the lowest cost.  
4.73.   The Secretariat r eport further notes that other charges can considerably increase the cost of 
imports into Sri Lanka.  Eliminating or significantly reducing such charges would also enhance 
predictability and af fordability of inputs for competitive domest ic consumption and production. We 
also hope that the G overnment will take care to abide by WTO rul es when modifying its tariffs. 
Here, I must mention our concern about some applied tariff lines that apparently ex ceed their 
bound rates.  
4.74.   Exporters of non -traditional goods exporting at least 80% of their production enjo y a 
number of tax concessions. We would like to know Sri Lanka 's rationale for such concessions not 
only in light of its WTO commitments but also in t erms of the economic and trade distortions that 
these can create.  
4.75.   We are pleased to acknowledge an important policy development that has taken place  since 
Sri Lanka 's last Review.  Sri Lanka 's legislation implementing the WTO Customs Valuation 
Agreement (CVA) is a major step forward. According to the Secretariat, however, that legislation 
grants the authorities the flexibility to depart from CVA rules when deemed necessary, in the 
interest of the national economy or for any other reason, allowing for the use  of minimum values. 
During the period under review, the Secretariat points out, Sri Lanka has applied such minimum 
import prices when calculating imp ort taxes applied to used cars.  We are disappointed tha t 
Sri Lanka 's implementation of this important agree ment has taken this turn and would like to know 
what options Sri Lanka may be considering to mitigate this unfortunate legislative outcome.  
4.76.   The Secretariat r eport notes that the Government of Sri Lanka remains determined to 
reduce further the list of secto rs in which for eign investment is restricted. We also note that many 
restricted sectors may be open to specific projects, depe nding on a case by case review.  We 
welcome this flexibility and other approa ches to open the economy. Another positive step would be 
for the government of Sri Lanka to decide to participate in the Agreem ent on Government 
Procurement. Also, to promote a positive climate for business and economic growth, we encourage 
the efforts by Sri Lanka to address governance issues, including stre ngthening the rule of law and 
combating corruption.  
4.77.   We hope that this trade policy review will help us to understand more clearly the ways in 
which Sri Lanka is addressing the important issue of protection o f intellectual property rights.  We 
believe that m ore can be done, particularly in the area of enforcement.  WT/TPR/M/347 • Sri Lanka  
 
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  4.78.   Finally, the United States will continue to work with Sri Lanka to strengthe n and deepen our 
relationship. Recent political changes in Sri Lanka have dramatically increased the scope for 
bilateral c ooperation and we are taking full advantage of that in our greatly expanded de velopment 
assistance programs. We look forward to working with Sri Lanka as we implement our bilateral 
5-year Joint Action Plan to Boost External Trade and Investment. We are con fident that this Plan 
will serve as a road map to higher growth, employment generation, increased opportunities, and 
higher living standards for the people of Sri Lanka.  
MALAYSIA  
4.79.   Sri Lanka showed a resilient growth throughout the review period maintaining an average 
annual growth rate in real GDP of 6%. This was driven by construction, wholesale and retail trade, 
and the financial services sectors. However, we also note that during the review period, trade in 
goods and non -factor services declined from the equivalent of about 55% of GDP in 2011 to 49% 
in 2015. This indicates that Sri Lanka is no exception to the global economic trend.  
4.80.   Malaysia and Sri Lanka have had long -standing bilateral trade relations. Total trade between 
the two countries stood at US$57 0 million in 2015, a contraction from US$722 million in 2014. 
Total exports of Malaysia to Sri Lanka was valued at US$481 million, while imports increased by 
82% to US$90 million.  
4.81.   Malaysia welcomes efforts by Sri Lanka in focusing on long -term strategic an d structural 
development since the end of its internal conflict. Nevertheless, much can be done to ensure that 
the investment regime facilitates and provides a more conducive environment for potential 
investors.  
4.82.   Sri Lanka has been an attractive FDI destina tion due to the many incentives in place for 
investments. According to Board of Investment data, since 2011, FDI inflows have been growing 
steadily and reached US$1.6 billion in 2014, while the stock of FD I in 2014 stood at almost 
US$10  billion. We note th at, based on the Secretariat report, Malaysia is among the largest 
investors in Sri Lank a, along with the United Kingdom, China, India and Hong Kong, China. 
Malaysia 's key investments are in property development, construction, power and 
telecommunication a mong others. As such, it is certainly important for us to work closely with 
Sri Lanka in improving investment facilitation that would benefit all sides.  
4.83.   To further enhance Malaysia -Sri Lank a bilateral trade, Malaysia is pleased to highlight that a 
proposal  has been made last May, for an FTA between Malaysia and Sri Lanka. Both sides are 
studying closely the potentials in order to take the initiative a step further.  
4.84.   Malaysia appreciates Sri Lanka 's effort at the multilateral front. We welcome efforts to 
implement the expanded Information Technology Agreement which was ratified by Sri Lanka in 
May 2016. I take this opportunity to thank H.E. D.S. Kumararatne, Ambassador/Permanent 
Representative of the Permanent Mission of Sri Lanka to the WTO, for his dynamic r ole as the 
current Chairperson of the Asia Group. We appreciate him and his delegation 's continuous 
engagement here with the other WTO Members.  
4.85.   Malaysia has submitted a few questions in advance of this meeting and welcome s the 
responses from Sri Lanka.  
4.86.   As highlighted earlier, with Malaysia 's vast interest in Sri Lanka, any newly introduced 
policies, regulations as incentives would have an impact on our investment. We therefore, 
welcome updates from Sri Lanka on its new proposed Investment Act to replace the  Strategic 
Development Act.  
4.87.   We also note that Sri Lanka currently has no laws and regulations to address safeguard 
measures. However, there has been a proposal on a trade defense bills on anti -dumping, 
countervailing and safeguard measures submitted to Cab inet. For purpose of transparency, we 
encourage Sri Lanka to share updates on the new legislation.  
4.88.   We also look forward to obtaining additional information on the 23 Agricultural Development 
Mega Zone that Sri Lank a is proposing in making its agricultural products more competitive.  WT/TPR/M/347 • Sri Lanka  
 
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  EL SALVADOR  
4.89.   We are pleased to participate in this important review of the trade policies of Sri Lanka, with 
which we are united by diplomatic ties and friendly relations.  
4.90.   As regards Sri Lanka's performance, the national economy h as shown resilience in the 
aftermath of the global financial crisis, with an average annual growth rate in real GDP of 6% 
during the review period. Growth was mainly driven by the construction, wholesale and retail 
trade, and financial services sectors.  
4.91.   The extensive reforms made to this Member's trade policy regime since 1977 have placed 
the country in a sound position from the economic development standpoint.  
4.92.   As noted from the Government report, these reforms have also contributed towards 
significant ach ievements in the social development sphere, where the country has made major 
strides in meeting the Millennium Development Goal targets set for 2015.  
4.93.   Trade continues to play an important role in the Sri Lankan economy, accounting for around 
49% of GDP in 2 015. As is the case for El Salvador, Sri Lanka's exports largely consist of 
agricultural products and clothing; this in itself represents a challenge for countries such as ours in 
terms of product and market diversification.  
4.94.   In light of the above, El Salva dor and Sri Lanka are working closely together on a number of 
issues under discussion at the WTO in order to promote the interests of the developing countries in 
various areas of negotiation, through their participa tion in groupings such as the G 33 and the  
Group of Small, Vulnerable Economies.  
4.95.   As indicated in the Secretariat report, Sri Lanka has tabled various proposals in the 
negotiations and has participated in the WTO's regular work and Committees. Another point 
worthy of note is the transparency of th is Member, which made many notifications during the 
review period that pertained mainly to customs valuation, agriculture, import licensing, sanitary 
and phytosanitary measures, and technical barriers to trade. No less relevant is the major step it 
has tak en in depositing its instrument of ratification of the Trade Facilitation Agreement.  
4.96.   I therefore take this opportunity to thank Ambassador Kumararatne and his team for their 
active participation in the work of this Organization, which demonstrates Sri Lank a's firm 
commitment to the multilateral trading system.  
MONTENEGRO  
4.97.   Montenegro would like to associate itself with the statement of the European Union.  
4.98.   Montenegro would like to appreciate firm and continuous commitment of Sri Lanka to the 
multilateral trad ing system and it active and constructive engagement in the works of the WTO 
and effective cooperation with all M ember states. We commend Sri Lanka for ratifying the TFA and 
for its contribution to the final negotiations resulting in strengthening of the W TO both in Bali and 
in Nairobi.  
4.99.   Montene gro wishes to congratulate the G overnment of Sri Lanka on its economic 
performance since its last review.  As the Secretariat notes, the Sri Lankan economy has shown 
resilience in the aftermath of the global financia l crisis and the resolut ion of internal conflict in 
Sri Lanka, with an average growth rate in real GDP o f 6% during the review period. As the 
Secretariat further notes, construction, wholesale and retail trade and financial ser vices have 
driven this growth . Given the challenges that the world economy has faced during this period – 
and still faces – these statistics are impressive.  
4.100.   At the same time, however, Montenegro notes the Secretariat 's report that the main risks 
to growth and sustainability in Sri La nka are result from the weak fiscal position – in particular, the 
fiscal deficit has increased from 6.5% of GDP in 2011 to 7.5% in 2015, well a bove the Government 
target of 4.4%. Montenegro hopes that notwithstanding such ch allenges, the Government of 
Sri Lanka can continue to improve on its excellent performance during the review period.   WT/TPR/M/347 • Sri Lanka  
 
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  4.101.   In this context, Montenegro will follow with interest developments pertaining to the 
strategic key priorities of Sri Lankan Vision of the Future including its export pro motion strategy, 
foreign direct investment and diversification of exports.  
4.102.   Although our two countries have a modest trade and economic relations, there has been an 
increase interest of Montenegro to Sri Lanka 's focus and reliance on the services sector. 
Montenegro 's economy is increasingly reliant on the service sector and tourism; and we regard the 
services sector as an area of important econo mic growth and sustainability. My d elegation notes 
that the services sector accounted for approximately 56.6% of S ri Lankan GDP in 2015 and that 
Sri Lanka has maintained an average growth rate in this sector of 7% over the period.  
4.103.   In addition, tourism has been a focus of the Sri Lankan Government as a sector to expand 
the economy and invest in infrastructure. The sec tor has a significant impact on the economy 
contributing over 12% to the foreign exchange earned in 2015. Montenegro will continue to follow 
closely implementation of the new policy and strategy for this sector, aligning regulations with 
international stan dards, and establishing a "One Stop Unit " for investment in tourism.  
4.104.   Finally, Montenegro is looking forward to continuing excellent and constructive 
engagement with the Sir Lankan in Geneva and my distinguished colleague Ambassador to the 
WTO, R.D. Susiri  Kumararatne and his team.  
PAKISTAN  
4.105.   Sri Lanka is among Pakistan 's main trading  partner, we have a trade preferential 
agreement in force since 2005. Our two countries are working together to further enhance bilateral 
trade and recently, efforts were direct ed towards an even more comprehensive economic 
partnership agreement (CEPA) that will include trade in services, investment and Customs 
cooperation. Pakistan investments in Sri Lanka are in the manufacturing and construction sectors, 
and the deepening of t he comprehensive economic partnership agreement will further boost 
bilateral trade between our two countries. In January 2017, Trade Development Authority of 
Pakistan will hold a second edition of a single country exhibition in Sri Lanka.  
4.106.   The transition o f Sri Lankan economy from a low income to a middle income was 
accompanied by some challenges, which the Government of Sri Lanka addressed with well 
targeted strategies. We commend the bold steps taken by Sri Lankan Government in carrying out 
and in impleme nting strategic policies for growth such as the ones outlined in the Government 
2010 vision for the future. Remarkable performances have been achieved by Sri Lanka since the 
last review in 2010: the economy has grown at an average 6.4 % between 2010 and 2015, both 
trade in goods and in Services recorded positive and strong growth. GDP per capita based on 
Power Purchasing Parity is continuing its increasing trend, in 200 5 GDP per capita was around 
US$5'000 and by 2015 this amou nt has double to reach over US$ 10'000. 
4.107.   As a result of Sri Lankan economic development, it performed well in the Human 
Development Index in 2015, where Sri Lanka ranked 73rd, with the highest score in Human 
Development Index value in South Asian Countries. According to World Bank , Sri Lan ka has 
comfortably surpassed most of the MDG targets set for 2015. Sri Lanka economic development has 
contributed to overcome successfully its human development challenges with a marked decline in 
poverty.  
4.108.   Furthermore, other international indicators such as the WEF global competitiveness index 
2016-17 ranked Sri Lanka as the second highest  among South Asia Countries. The WEF Global 
Gender Gap report of 2016, ranked Sri Lanka at 100th place out of 138 countries  
4.109.   Services sectors have made significant contri bution to the economic growth of Sri Lanka. 
Reforms in Telecom sector has improved Sri Lanka ranking in WEF Network Readiness Index from 
76th out of 148 in 2014 to 63rd out of 139 in 2016. UNCTAD B2C e -commerce index 2016 ranked 
Sri Lanka second highest in  South Asia. Sri Lanka has the most affordable prepaid mobile and 
fixed broadband internet tariffs in the World. This is further confirmed in the 2016 World Bank 
report titled Digi tal dividends which indicates "If you want to make  a mobile phone call, go t o 
Sri Lanka ".  WT/TPR/M/347 • Sri Lanka  
 
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  4.110.   We applaud the different reforms carr ied out in several key sectors  to enhance growth and 
we would like particularly to highlight reforms made in two specific areas indicated by the World 
Bank in its October 2016 report: Starting a Business and Protecting Minority Investors.  In the past 
five years, Sri Lanka has implemented the highest number of Doing Business reforms in the 
region, with 12 reforms in total. As part of such reform, we commend Sri Lanka for ratifying the 
WTO Trade Facilitation  Agreement.  
4.111.   At the WTO in Geneva, we highly appreciate the positi ve and active engagement of 
Sri Lanka via its Mission led by H .E. Ambassador  Kumararatne , mainly in Sri Lanka 's role as the 
coordinator of the group of Asian developing countries, and for hi s close collaboration in Friends of 
Ecommerce for Development.  
INDIA  
4.112.   We would like to commend the Government of Sri Lanka for achieving sustained economic 
growth at an average rate of 6 % from 2010 to 2015. The per capita income of Sri Lanka has also 
increa sed significantly from US$2744 in 2010 to US$ 3924 in 2015. The Secretariat r eport 
mentions that the main risks to growth sustainability and development in Sri Lanka result from the 
weak fiscal position and re sulting public debt over hang. The country also faces challenges relating 
to energy security, skill development gap, food security, low productivity and lack of d iversification 
in the economy. We have noted that Government of Sri Lanka 's long term strategic and structural 
development plans since the end  of internal conflict in the country have borne results. We also 
appreciate the measures being taken by the Government of Sri Lanka to address the challenges by 
bringing fundamental challenges to tax policy and administration to boost revenues and public 
finances and efforts to boost exports and promote investment in the country.  
4.113.   India and Sri Lanka share centuries old ties of friendship and civilizational linkages. Both 
countries are closely linked through geography, history, religion , language, culture a nd trade. In 
recent years, the relationship has further deepened and strengthened in all spheres with regular 
exchanges at the highest level.  
4.114.   India and Sri Lanka also share a close and vibrant econom ic and commercial partnership. 
India is Sri Lanka 's large st trading partner and Sri Lanka is amongst India 's largest trading partner 
in South Asia. The total trade between both co untries in 2015 -16 stood at US$ 6.05 billion with 
exports from India amounting to US$ 5.30 billion and imports from Sri Lanka amounting to 
US$742  million.  The India -Sri Lanka Free Trade Agreement which came into effect in 2000 
provides a framework for  trade between both countries. In 2015 , both countries have mooted an 
Economic and Technological Cooperation Agreement covering trade in good s, services, 
investments, technology cooperation, capacity creation and other elements, which is under 
discussion. Bilateral inves tments are also on an upswing. Indian  companies are investing in 
Sri Lanka in the areas of petroleum, retail, IT, financial se rvices, real estate, hospitality and 
tourism with cumu lative investments for over US$1 billion. Similarly, Sri Lankan investments into 
India in the areas like garments, real estate, hospitality industry and the logistic sector are also 
growing.   
4.115.   India and  Sri Lanka also have a multifaceted develo pment cooperation partnership. Since 
the end of the internal conflict in Sri Lanka, the Government of India has put in place a robust 
programme of assistance to help the Internally Displaced P ersons ' return to norm al life. Sri Lanka 
is one of the major recipients of development credit given by India wit h cumulative commitments 
of US$2.6 billion, including US$436 million as grants. Under development credit, major railway 
projects hav e been undertaken in Sri Lanka.  Buyer credit agreements have also been signed for 
water supply and other projects. India is also working closely with the Government of Sri Lanka in 
other sectors as well, including education, health, transport connectivity and capacity building.  
4.116.   To conclude , there is tremendous potential to further strengthen and take our bilateral 
relationship to greater height in all spheres. We also look forward to working with the authorities 
of Sri Lanka in further expanding our trade and investment ties for mutual bene fit.  WT/TPR/M/347 • Sri Lanka  
 
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  MAURITIUS  
4.117.   We wish to commend the efforts of the Government and People of Sri Lanka towards 
national reconciliation as a major step for restoring  economic and social normalcy. There have 
been notable initiatives to attract and bolster investment with  a view to making Sri Lanka an 
important logistics a nd services hub in the region. We believe that focus on infrastructure 
development as well as continued improvements in the political environment and security situation 
will enhance prospects for foreign direct investment and tourism.  
4.118.   Sustained economic growth rates, and macro -economic stability measures, will ensure that 
the Government of Sri Lanka delivers on the inclusive trade agenda and achieve the Sustainable 
Development Goals.  
4.119.   Sri Lanka and Mauritiu s share the same characteristics, as Small and Vulnerable Economies 
and Net Food Importing countries. We also have similar objectives as regards broadening and 
diversification of growth pillars. Agriculture, NAMA, the fisheries as well as the services sect ors are 
key areas of interest in the WTO negotiations for both of our two countries.  
4.120.   As members of the Indian Ocean Rim Association, both Sri Lanka and Mauritius share the 
same vision and economic objectives to deepen intra -regional trade and improved trad e facilitation 
measures so as to enable further trade in goods and services between our two countries.  
4.121.   The Mauritius delegation looks forwa rd to working closely with the d elegation of Sri Lanka 
and in various groupings, as we head to important discussions at the WTO with a view to reaching 
meaningful outcomes for MC11.  
GUATEMALA  
4.122.   Sri Lanka is a multi -ethnic and multi -faith country, famous for its tea, coffee and rubber 
production. It has a growing industrial economy, which has significantly increased its per  capita 
income in recent decades. Thanks to its natural beauty, the diversity of its landscapes and its 
invaluable cultural heritage, Sri Lanka has become a world -renowned tourist destination.  
4.123.   Although trade between Guatemala and Sri Lanka is limited (aro und US$5 million in 2015), 
the two countries share many characteristics that have brought them closer together and enabled 
them to cooperate closely within the WTO framework. It is important to note that, as a member of 
the Group of Small, Vulnerable Econo mies, Sri Lanka has consistently made a proactive and 
dedicated contribution to the Group's work.  
4.124.   Turning to the review that brings us here today, we note Sri Lanka's resilience in the face 
of the global crisis and the country's 6% annual growth in real G DP during the review period. We 
also underscore the gradual strengthening of Sri Lankan institutions and the structural reforms 
undertaken, as refle cted in the Mahinda Chinthana Vision for the Future programme, the efforts 
made to encourage more foreign di rect investment, and the measures aimed at simplifying and 
increasing the efficiency of key sectors, such as that of financial services.  
4.125.   We note the short and medium term challenges of stepping up efforts to simplify the 
country's tariff and tax systems, a nd of strengthening and revisi ng the legal framework of 
state-owned enterprises, as their outstanding obligations are the equivalent of 12% of GDP.  
NEPAL  
4.126.   The circulated reports reveal that since the trade liberalization initiated in 1977, several 
trade pol icy reforms have been achieved, which have laid strong foundation on socio -economic 
development of Sri Lanka.  
4.127.   We are glad to disclose that Sri Lanka has performed relatively well since its last review in 
2010. Its economy has shown resilience following the  initiatives of the internal conflict, and 
gathered strength even in the face of the global financial crisis.  WT/TPR/M/347 • Sri Lanka  
 
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  4.128.   We appreciate that since its last review, the Government has been guided by its 2010 
"Mahinda Chinthana – Vision for the Future " which focuses on structural changes and sets out 
specific targets for GDP and export growth by reducing the reliance on agriculture and diversifying 
to other important areas like manufacturing and services.  
4.129.   The progressive and continuous liberalization of the market to int egrate into the 
multilateral trading system, coupled with a commitment to fulfilment  of WTO obligations, has 
made Sri Lank a a more reliable and predictable trading partner.  
4.130.   Relatively stable macroeconomic architecture of Sri Lanka remained supportive to 
increasing per capita income and maintaining the economic growth at an average rate of 6% per 
year over the review period despite external pressure arising from global economic slowdown and 
other domestic economic challenges.  
4.131.   As close South Asian neighbour , Nepal and Sri Lanka are the members of the Non -Aligned 
Movement (NAM), the South Asian Association for Regional Co -operation (SAARC) and the Bay of 
Bengal Initiatives for Multi -Sectoral Technical and Economic Cooperation (BIMSTEC).  
4.132.   We want to recall that t wo agreements to trade and air service to link both countries were 
inked during President Mahindra Rajapaksa 's state visit to Nepal in 2009. The improved air 
connectivity between the two countries has significantly contributed the increase of tourists to 
Nepal. Nearly 40 000 Sri Lankan tourists visit Nepal every year through the direct air link between 
Kathmandu and Colombo. Nepal and Sri Lanka can package their unique beaches and mountains 
and the complementary of cultural experiences for the growth and pr omotion of tourism within and 
into South Asia.  
4.133.   Nepal exports lentil, plastic, wood and charcoal, carpet, art, electrical machinery and 
equipment, sound recorder, television, etc. to Sri Lanka while Nepal imports from Sri Lanka mainly 
cocoa and cocoa prepar ations, coffee, tea, spices, electrical machinery and equipment and so on. 
However, compared to the potentials for enhanced trade, investment and joint economic 
collaboration between two nations, there is much to do to seize the opportunity already availab le 
under South Asian Free Trade Agreement (SAFTA) and BIMSTEC for enhanced trade flows between 
the two nations. We encourage wider exploration and larger awareness building by the Business 
Councils established between Nepal and Sri Lanka in stimulating the  trade relations further.  
4.134.   Finally, it is appreciable that Sri Lanka is striving to reach the status of upper -middle -
income country focusing on long -term strategic and structural transformation of its economy. We 
wish Sri Lanka a success in this direction.  
JAPAN  
4.135.   We, Sri Lanka and Japan, have been important partners for years. Japan is the third 
largest importer for Sri Lanka. Also, Japan has been one of the largest donors for years. Japan will 
make continuous efforts to maintain and further develop the stron g ties between us.  
4.136.   Let me begin by touching on the general economic situation. According to the Secretariat 's 
report, the economy of Sri Lanka has been well since the last review. The country 's average 
annual economic growth rate during the review period w as over 6%. Moreover, Sri Lanka has 
successfully maintained relatively low unemployment rate, and has reduce d inflation rate to less 
than 1 %. Those achievements are commendable.  
4.137.   Having said that, Japan believes Sri Lanka has problems with relatively weak f iscal 
position. In this regard, Japan is glad to read in the Secretariat 's report that the Government is 
now undertaking a reform. Japan h opes that those efforts by the G overnment will have a fruitful 
outcome.  
4.138.   Let me turn to the country 's trade policies.  
4.139.   According to the Secretariat 's report, Sri Lanka 's primary objective of its trade policies is to 
renegotiate existing trade agreements including two bilateral agreements with India and Pakistan 
and two regional trade agreements. Furthermore, according to th e report, Sri Lanka seems to have WT/TPR/M/347 • Sri Lanka  
 
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  a clear intention to enter into negotiations with not only China and India but also the United 
States. Although it is unfortunate that there is no FTA currently in force between Sri Lanka and 
Japan, Japan positively evalua tes the country 's efforts toward trade liberalization through FTAs.  
4.140.   Apart from the FTAs, according to the report, Sri Lanka has a plan to enact the new Trade 
Regulation Act and replace the Imports and Exports (Control) Act. Japan requests Sri Lanka 
further  explanations about this plan.  
4.141.   Now let me briefly touch upon the country 's investment policies.  
4.142.   Despite the continuous efforts by the Government of Sri Lanka, the country is still a 
challenging place to do business. According to the recently published repo rt by the World Bank, it 
ranked 110th out of 190 economies.  
4.143.   Sri Lanka has introduced several restrictions to foreign investment. Among others, Japan 
pays much attention to the land act of 2014 which prohibits the transfer of land to a foreigner. It 
seems t o be difficult to estimate potential impact of this new act on foreign investors ' activities. 
Japan requests Sri Lanka to provide Members with detailed explanations of this new act especially 
about the point on whether  the introduction of the new land act removes a land transfer tax of 
100% or not.  
4.144.   In conclusion, I would like to express our strong wish to continue cooperation between the 
Democratic Socialist Republic of Sri Lanka and Japan.  
KENYA  
4.145.   We commend Sri Lanka for the reforms that have been implement ed during the review 
period which enabled the country to achieve an average rate of real GDP growth of 6% between 
2011 and 2015, driven mainly by the tourism, construction, wholesale and retail trade, a nd 
financial services sectors. We note the reports tha t economy is dominated by the services sector, 
which accounts for 60% of GDP, followed by manufacturing at 20%, and agriculture at 9% of GDP.  
4.146.   Although the contribution of a griculture to the economy and trade has been declining, it 
remains an important sec tor for the Sri Lanka in terms of employment, food security and 
livelihood, particularly for the majority of the population living in the rural areas. In this context, 
there is need for the Sri Lanka to improve productivity in agriculture in order to reali ze the full 
potential of this important sector.  
4.147.   We note that Sri Lanka has pursued strategic trade policy initiative aimed at achieving 
greater integration into the global economy through preferential reciprocal trade agreements as 
well as multilateral arr angements. We therefore welcome the various bilateral and regional 
integration initiatives which have contributed in expanding market a ccess opportunities for the 
Sri Lanka 's exports and which we consider complimentary to multilateral approach.  
4.148.   At multila teral level, we appreciated the active role Sri Lanka has continued to play in the 
work of the WTO both in the regular committees and in the Negotiating Groups. Sri Lanka has also 
shown commitments in the implementation of negotiated outcomes as demonstrat ed by its 
acceptance of the Trade Facilitation Agreement (TFA) and submission of its category "A" 
commitments. Further, on trade facilitation, we commend Sri Lanka for establishing of the single 
window system which allows all entities involved in importing  and exporting to submit required 
regulatory information to a single electronic gateway and to use electronic funds transfer or online 
payments.  
4.149.   At bilateral level, Kenya and Sri Lanka have continued to enjoy cordial economic and 
diplomatic relations sinc e 1970. In December 2013, the presidents of the two countries witnessed 
the signing of an Agreement establishing the Joint Commission for Cooperation which is the 
primary point of contact for advancing, monitoring and evaluating bilateral ties between the two 
countries.  
4.150.   Sri Lanka remains an important tradi ng partner for Kenya. The two countries share one 
thing in common in that they are key producers and exporters of tea to the world market. Total WT/TPR/M/347 • Sri Lanka  
 
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  trade between Kenya and Sri Lanka was valued at US$14.3 m illion in 2015, up from 
US$10.2  million in 2014. Kenya 's main exports to Sri Lanka include natural sodium carbonate, 
salt, pepper, and tea which is used for blending purposes. Sri Lanka 's main exports to Kenya 
include natural rubber, general industrial machi nery, and equipment.  
4.151.   In conclusion, we wish Sri Lanka a successfully trade policy review process and looks 
forward to continued collaboration and constructive engagement with Sri Lanka, both bilaterally 
and here at the WTO.  
RUSSIAN  FEDERATION  
4.152.   The Russian F ederation follows with great interest the economic performance of Sri Lanka, 
following the resolution of the internal conflict. The continuous growth of its economy, with an 
average annual rate of 6%, enables us to give an overall positive assessment of th e economic 
policies pursued by Colombo. The reforms implemented by the Government of Sri Lanka since the 
last TPR have greatly contributed to this performance.  
4.153.   Diplomatic relations between the Soviet Union and Sri Lanka were established on 
19 February  1957. But the history of our bilateral relations has started much earlier. The first 
Russians appeared in Ceylon in mid XIX century, and a Russian Consulate was established in Galle 
in 1891.  
4.154.   The solid basis for the mutually beneficial cooperation was laid dow n in the 60s and 70s of 
XX century by the package of bilateral agreements signed by our countries in the spheres of trade, 
economy, science, technology and culture. During the years of our bilateral relations, thousands of 
Lankan students have graduated fr om universities of the Soviet Union and then Russia in 
medicine, engineering and education.  
4.155.   Presently , Russia and Sri Lanka enjoy gradual growth of bilateral trade. Since 2002 , Russia 
holds the stable position of leading importer of Sri Lankan te a. In 2015  Russia imported 
41.9 thousand tons of tea for a total sum of US$ 193.8 million.  
4.156.   Besides tea, Russia imports from Sri Lanka rubber, leathe r, spices and garments. And 
Sri Lanka imports from Russia steel, ferrous metal wares, asbestos, fertilizers, electrical  equipment 
for metallurgical works. Several Russian and joint enterprises are registered in Sri Lanka, with the 
total volume of Ru ssian investments exceeding US$ 7 million.  
4.157.   In February 2016 , the first meeting of the Russia -Sri Lanka Intergovernmental Commi ssion 
on Trade, Economic, Scientific and Technical Cooperation was held in Moscow. The two parties 
discussed the ways to strengthen bilateral trade and economic relations and signed a Protocol to 
elaborate an Action Plan.  
4.158.   During this TPR , the Russian deleg ation has not addressed any written q uestions to 
Sri Lanka. Should the need arise  we will be ready to discuss bilaterally.  
4.159.   To conclude, we look forward to work with the authorities of Sri Lanka in order to expand 
our trade and investment ties for mutual be nefit.  
OMAN  
4.160.   Oman and Sri Lanka enjoy excellent political, economic and trade relations. These relations 
are expected to grow and expand in the years ahead. Both Oman and Sri Lanka are members of 
the Indian Ocean Rim Association (IORA).  
4.161.   Oman is pleased to note that despite the global financial crisis, Sri Lanka has been able to 
attain a reasonable economic growth with an annual growth rate in  real GDP of 6% since the last 
Trade Policy R eview in 2010. The per capita income has increased from US$2,744 in the year 2010 
to US$3,924 in 2015. Inflation has been maintained at a very low level. All this is testament to the 
fact that the extensive economic reforms that Sri Lanka has embarked upon are beginning to show 
signs of improvements in Sri Lanka 's economic per formance.  WT/TPR/M/347 • Sri Lanka  
 
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  4.162.   Oman commends Sri Lanka for  its strong commitments to the multilateral trading s ystem 
and for adhering to the rules and disciplines of the WTO. It has been abiding by its commitments 
under the multilateral trade agreements and has not been a main  party in any dispute under the 
WTO Dispute Settlement Mechanism during the period of review.  WT/TPR/M/347 • Sri Lanka  
 
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  5  REPLIES BY THE REPRE SENTATIVE OF SRI LANKA  AND ADDITIONAL COMME NTS 
5.1.  It is with great pleasure that  I participate in the second  day of the meeting of Sri Lanka 's 4th 
Trade Policy R eview. On behalf of my country and the delegation , I convey my profound thanks to 
the Ambassadors and representatives of the WTO M ember countries who have actively participated 
in our trade policy review meeting. I am delighted to observe the interest of the M embers in our 
trade and economic policy developments.  
5.2.  At this concluding phase of the Trade Policy Review of Sri Lanka, it is opportune to indicate 
some of the positive conclusions that delegates have graciously pointed out during the  discussions 
on Tuesday 1st November 2016.  
5.3.  There is a general consensus on the healthy and robust economic performance of Sri Lanka 
showing an average growth rate of 6% during the period of the Trade policy Review and a GDP per 
capita growth exceeding 25%.  Moreover , my country has been congratulated for maintaining a 
reduced rate of inflation less than 1% and a relatively low rate of unemployment. These salutary 
developments have taken place amidst external global financial upheavals as well as domestic 
constraints.  
5.4.  Delegates have noted Sri Lanka 's ratification of two important instruments of international 
obligation , namely  the WTO Trade Facilitation Agreement, the submission of Category A 
commitments and the WIPO Marrakesh VIP Treaty.  
5.5.  At the same time, I w ould like to take this occasion to address in broad overview the few 
areas of concerns presented by the delegations. The Sri Lanka delegation has already made 
detailed assessment and answers to the approximately 138 questions received from 12 M ember 
countr ies. However, as we conclude our review on Sri Lanka, it is my pleasant duty to briefly 
enumerate the same.  
5.6.  In regard to trade measures and practices, both the discussant and several delegations have 
mentioned that some bound rates have exceeded the MFN ra te for a number of products. 
Sri Lanka has taken steps to adjust the applied duty rates which have exceeded the Sri Lanka 's 
bound rates to the WTO in the budget 2017 except few tariff lines on emerging health and social 
considerations.  
5.7.  The concerns of some  of the WTO M embers on the application of some duties and charges, 
Sri Lanka wishes to inform that Sri Lanka is reviewing the additional taxes , namely  Ports and 
Airports Development Levy and CESS Duty and it is expected to phase out those additional levies  
starting from 2017.  
5.8.  Sri Lanka has also noted the concerns raised by some delegations on the implementation of 
the Customs Valuation Agreement on application of minimum value for Cus tom Valuation of used 
vehicles.  I wish to state that Sri Lanka has done aw ay with the application of Article 10 of the 
Customs Ordinance that empowers the application of minimum value for valuation of motor 
vehicles.  
5.9.  In the case of the excise tax on motor vehicles, which is applied on non -discriminatory basis, 
has been structure d to promote importation and use of new generation of motor vehicles with 
alternative energy source and environment friendliness which are suitable for road networks of 
Sri Lanka. For instance, applied tax on all type of electric vehicles is less than 50% of CIF value 
and on import duty on hybrid vehicles is 100%  of CIF value.  
5.10.   In respect of concerns expressed by certain delegations on the area of land ownership and 
investment regime, Sri Lanka wish es to inform the M embership of the WTO that a new land polic y 
has been introduced and accordingly the new Land (Restriction on Alienation) Act No. 38 of 2014 
was promulgated. With introduction of this new law, the previous law related to 100% land 
transfer tax law was abolished. Now the Companies with less than 50%  foreign shareholding are 
permitted to purchase land outright and others will be eligible to lease and for a maximum period 
of 99 years. The upfront payment of land lease tax by foreign companies that was originally 
introduced was subsequently removed and the applicable amendments to the law are being 
presented to the parliament.  WT/TPR/M/347 • Sri Lanka  
 
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  5.11.   With regard to the Incentive Regime of Sri Lanka, currently it does not offer any incentives 
contingent upon export performances and a new incentive regime will be announced at the  
forthcoming budget in 2017, which will be neutral and horizontal in application.  
5.12.   We thank the delegations who have also taken cognizance of the growing fiscal deficit and 
enjoined on us the necessity to take appropriate remedial measures. In this regard , we wish to put 
in perspective the cours e of action to be taken by the G overnment of Sri Lanka. The Government 
has committed to improve its fiscal position in the medium term by increasing the revenue 
collection, reducing the budget deficit and rationalizin g the public expenditure. These initiatives will 
be supported by rationalization of Public Debt related to SOEs by converting them into the joint 
venture equity or equity and  restructuring SOEs in respons e to the market driven business 
environment.  
5.13.   I wish to convey our sincere thanks and gratitude to Madam Irene Young , Chairperson of 
the Trade Policy Review Body, H.E. Dr Stephen Karau, d iscussant to our Trade Policy Review, for 
his insightful comments on our trade policy. Also to Mr  Yonov Frederick Agah, De puty Director 
General, WTO; Mr. Willy Alfaro , Director, Tra de Policies Review Division; Mr  Masahiro Hayafuji  , 
Counsellor, Trade Policies Review s ection; Ms. Denby Probst, Cou nsellor, Trade Policies Review 
section; Mr. Usman Ali Khilji, Trade Polic y Analys t, Trade Policy Review s ection, for their dedicated 
efforts in producing comprehensive reports which have been useful for our meeting.  
5.14.   Sri Lanka believes that the 4th review of Sri Lanka 's trade policy has pro vided valuable 
opportunity for M embers to enhan ce their understanding on Sri Lanka 's economic and trade 
policies. I , therefore , would like to conclude my remarks by expressing my deepest appreciation to 
all Members for the great interest and support expressed during the 4th Review.  
DISCUSSANT  
5.15.   My assess ment is that, during our first meeting on Tuesday, we had excellent discussions on 
the economic performance of Sri Lanka as well as its trade policies and practices since its last 
review in 2010. The contributions from delegations were constructive and enc ouraging.  
5.16.   I wish to highlight that delegations commended Sri Lanka for the reforms it has 
implemented since the resolution of internal conflict which have enabled the country to achieve 
impressive economic growth. The delegations also encouraged Sri Lanka  to sustain the reform 
process including the implementation of programmes under the new "Vision for the Future " in 
order to realize its long term economic and development objectives.  
5.17.   Further, delegations commended Sri Lanka for its active participation in  the work here at the 
WTO and for progressively and continuously liberalizing its market in order to integrate into the 
multilateral trading system. The delegation of Sri Lanka at the WTO , led by H.E . Ambassador 
Susuri Kumararatne , was commended for raisin g the profile of Sri Lanka 's participation at the 
WTO. Positive developments were also pointed out particularly in the area of customs procedures 
where the single window system has been  implemented. It was also noted with appreciation  by 
many delegations t hat significant reforms were undertaken in the services sector and have 
achieved the desired results.  
5.18.   Some of the challenges facing Sri Lanka such as weak fiscal position; underperforming 
state-owned enterprises; concentration of trade on a few markets and  products; and undiversified 
services sector, were also highlighted by many delegations. Concerns were also raised including 
the costly import regime due to application of additional levies and charges; complex tariff 
structure which makes the import regim e less transparent and unpredictable.  
5.19.   We appreciate the comprehensive statement by the delegation of Sri Lanka which has 
outlined some of the measures the Government intends to take in addressing some of the 
challenges faced as well as the concerns that w ere raised by delegations. We welcome the reforms 
that have been mentioned with regard to land ownership.  
5.20.   At this point, let me conclude by thanking you , Madam Chair , for giving me the opportunity 
to participate as a discussant for the fourth Trade P olicy Review of Sri Lanka. I also thank the 
Members for their valuable contribution and the del egation of Sri Lanka led by the Honourable  WT/TPR/M/347 • Sri Lanka  
 
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  Rishad Bathiudeen  for its constructive engagement during the review. I thank you for your 
attention.  
EUROPEAN  UNION  
5.21.   The EU w ould like to thank the delegation of Sri Lanka for the replies it has provided to the 
EU's advance questions. The replies and the discussion held last Tuesday  and today  have been 
very instructive for better understanding Sri Lanka 's trade and economic poli cies. The EU has no 
follow -up questions.  
5.22.   As noted last Tuesday by several Members, Sri Lanka needs to make additional efforts to 
improve its business environment and, in particular, to diversify further its economy.  
5.23.   In this regard, t he EU will follow clo sely the works of the Government and welcomes the 
objectives to adopt export promotion strategy, encourage more foreign direct investment, and 
promote the diversification of exports.  
5.24.   In this respect, the EU would like to underline that improving the busin ess environment 
requires also the effective implementation of the various policy initiatives and plans that will be 
adopted by the Government in the future.  
5.25.   Finally, we heard the call of Minister on GSP+ status on Tuesday and have taken careful 
note of tha t. As already indicated, the EU is well aware of the economic importance for Sri Lanka 
of being granted GSP+ status. We are currently conducting a technical assessment of the 
application and will inform Sri Lanka accordingly by the end of this month, with a view of the final 
decision being taken by mid -May 2017, at the very latest, following the necessary internal 
procedures.  
5.26.   In conclusion, we would like to thank again the delegation of Sri Lanka for its constructive 
participation in this exercise . 
UNITED  STATES  
5.27.   Just a few words of appreciation  for the work that the delegation of Sri Lanka has devoted 
to this exercise and our special thanks to the Honourable Minister for clearly having reflected on 
the interventions from Tuesday. The remarks that were provid ed this morning were very helpful  to 
put the pieces together . Thank you very much for that.  
5.28.   I was chatting before the meeting with the Ambassador and noted , in anticipation of the 
United States Trade Policy Review which is coming up in a few weeks , that th is is a very 
challenging process for all Members but we consistently find, despite the difficulties and the 
discomfort of occasionally being criticized on certain policies, that there is great value in hearing 
from other Members and understanding clearly what other Members are reflecting about our own 
trade policies . And we certainly hope that this has been the positive experience for the delegation 
of Sri  Lanka.  
5.29.   We, the United States, were a bit uncharacteristically late in submitting our written 
questions  so we are, for that reason, looking forward to still receiving written responses and will, 
as appropriate, follow -up with your colleagues at the Mission here in Geneva.  
5.30.   I would just like to say that we have very much appreciated some of the verbal respon ses 
that we had on issues that we have raised and, in particular, on the issue of customs valuation 
with respect to imported used automobiles  where we received some reassurances and some 
documentation, which is being examined in our capital. We very much a ppreciate that and , again , 
I think it reinforces and demonstrates the usefulness of this ability to engage with each other. 
Thank you very much again to all of you for your efforts and congratulations.  
 
Agenda item: Adoption of TPRB 's Annual Report for 20 16 
5.31.   The TPRB ad opted its Annual Report for 2016  contained in document WT/TPR/W/114/Rev.1 . WT/TPR/M/347 • Sri Lanka  
 
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  6  CONCLUDING REMARKS B Y THE CHAIRPERSON  
6.1.  This Trade Policy Review has provided a very good opportunity for Members to understand 
better recent developments in Sri Lanka 's trade policies and the challenges it faces. We owe this to 
the active participation of the Sri Lankan delegation, our discussant, and the 21 delegations which  
took the floor.  
6.2.  At this  meeting, Members praised Sri Lanka for having achieved robust real GDP growth 
despite adverse circumstances. Noting the country 's high and increasing level of public debt, 
Members urged Sri Lanka to continue with its fiscal consolidation efforts and deepen its structural 
reforms, including the reforms of state -owned enterpris es and trade policies. Recognizing the 
importance of the agricultural sector to Sri Lanka 's development, Members welcomed Sri Lanka 's 
plans to move forward from subsistence farming to agribusiness, with a view to accessing export 
markets by 2020.  
6.3.  Members w ere informed by the Sri Lankan delegation that the National Unity Government 's 
objective was to provide a common platform to deliver long -term social and economic solutions 
that could solve key problems currently affecting the country. More specifically, t he Government 
intended to implement an export -led growth strategy which focused on, inter alia , facilitating the 
country 's entry into global value chains, providing a competitive business and investment 
environment, diversifying the country 's products and export markets, and promoting the country 
as the economic hub in Asia.  
6.4.  Members appreciated Sri Lanka 's active involvement in the WTO, especially the role played 
by the delegation as coordinator of the Asian Group of Developin g Countries. Many commended 
Sri Lanka on its ratification of the Trade Facilitation Agreement and the establishment of a customs 
single window for exports and imports. Some Members also encouraged Sri Lanka to accede to the 
Agreement on Government Procurement. While they welcomed Sri La nka's overall commitment to 
the multilateral trading system, some Members raised concern about customs valuation and the 
use of minimum values. The delay in submitting notifications in the agriculture area was also an 
issue to be addressed.  
6.5.  Members acknowl edged Sri Lanka 's marked improvement in doing business and corruption 
indices, and hoped to see further progress. In particular, Members sought the removal of obstacles 
to trade and investment, such as the restrictions on foreign ownership of land and rigi d capital 
controls. Many expressed concern about the unpredictable tariff regime, which was compounded 
by a myriad of additional taxes and levies including a high excise duty on automobiles and the 
special commodity levy. Members also noted an increase in the number of tariff lines where the 
applied rates exceeded the bound rates.  
6.6.  During this review, Sri Lanka received nearly 140 advance written questions, and has already 
responded to most of them. In a month 's time, Members should receive Sri Lanka 's repl ies to  all 
the outstanding questions, which will then mark the successful conclusion of this TPR.  
6.7.  This TPR has enabled Members to better understand Sri Lanka 's trade policies and to 
highlight pertinent issues in specific areas. In his responding statement,  the Minister has 
addressed most of concerns raised by Members, and has taken note of other comments and 
suggestions. I hope the delegation finds this exchange useful in helping Sri Lanka make further 
progress in its economic and trade reforms, and in due course, successfully accompli sh its "Vision 
for the Future ". 
__________