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Sri Lanka may lose hard won access concessions into the EU market, if local labour laws are not liberalised fast. Sri Lanka won export tariff reductions into the European Union in January this year based on the high standard of local labour laws.
Although initially only for two years until 2006, the concessions, that takes tariffs down to a single digit, are open for extension based on periodic reviews.
The chief beneficiary of the tariff cut is the local clothing and textile sector.
The EU is Sri Lanka’s second largest export destination for apparel and the special entry concessions will come in extra useful next year, when international competition is unleashed in the wake of quota removals.
However, the concessions come with a road map of recommendations from the European Commission that the country will be appraised against.
The problem is that: "So far there are no signs of the government implementing the recommendations," according to the programme officer from the Fried