US – SRI LANKA ECONOMIC RELATIONS – (Trade, Investment & Tourism)

Trade and Investment Framework Agreement (TIFA) between Sri Lanka and the USA

The Trade and Investment Framework Agreement (TIFA), signed by the USA and Sri Lanka on 25th July 2002 in Washington DC, provides an ideal platform for the two Governments to maintain a closer dialogue on a number of areas / fields that are of mutual interest to them.

The Joint Council, formed under the TIFA had held twelve (13) meetings by 2019. Minister of Development Strategies and International Trade Malik Samarawickrama led Sri Lanka delegation to the 13th US-Sri Lanka Trade and Investment Framework Agreement (TIFA) Council Meeting held on 19th and 20th June 2019 in Colombo, which agreed to take number of actions to boost bilateral trade and investment.

The 13th Council meeting was Co-chaired by Mr. Christopher S. Wilson Assistant United States Trade Representative, South and Central Asia and Minister of Development Strategies and International Trade, Malik Samarawickrama.

The two sides had productive engagement on a number of areas such as market access and reforming of Sri Lanka's trade and investment regime, including her compliance with the WTO Agreement on Trade Facilitation and strengthening of intellectual property rights and effective enforcement, encouraging development and innovation in the digital economy, government procurement and trade capacity building with an emphasis on the economic empowerment of women. In a showing of the comprehensive and fruitful nature of the meetings, the delegations also made progress in discussions on certain labour and environmental concerns too.

At the conclusion of the meeting, both delegations assessed the results of their engagement as a significant step forward in increasing bilateral trade and investment opportunities between the two countries.

US-Sri Lanka Bilateral Trade Relations

The US continues to be the single largest export destination for Sri Lankan products with approximately 26% of its exports. Sri Lanka’s exports to the US demonstrated an impressive growth of 43.7% in 2018 compared to 2011. According to the latest trade statistics, Sri Lanka’s exports to the US amounted to US $ 3.08 Billion in 2018.

Total Imports to Sri Lanka from US in 2018 was US $ 645.4 million, while total trade turnover between Sri Lanka and the US remained at all time high of US $ 3.7 billion. The balance of trade is in Sri Lanka’s favour amounting to US $ 2.4 billion.

Sri Lanka’s trade with the US   

Year         Exports from Sri Lanka    Imports into Sri Lanka      Balance of Trade

US $ Million                        US $ Million                       US $ Million

2010         1,765                                    178                                       1,597

2011         2,145                                    307                                       1,860

2012         2,114                                    224                                       1,880

2013         2,497                                    353                                      2,144

2014         2,720                                   493                                       2,228

2015         2,800                                    471                                      2,330

2016         2,810                                    540                                      2,270

2017         2,912                                    811                                      2,101

2018         3,084                                   645                                       2,438

Source: Sri Lanka Customs

trade chart

FOREIGN TRADE POLICY Following the trade liberalization initiatives introduced as far back as late 1970s and continued by all successive governments to-date, Sri Lanka is currently known to be the most liberalized economy in the entire region of South Asia. Series of unilateral measures implemented over the years have resulted in rationalization and simplification of the country’s tariff structure to a large extent.

The foreign trade policy, which continues with the process of further liberalization of the country’s current trade regime, aims at integrating Sri Lanka with the global economy within the positive attributes of free market economy, while holding in balance the interests of the domestic industry through specific measures.

Today, tariffs and other border levies act as the key tools for regulating the foreign trade regime of Sri Lanka, while there are hardly any barriers or impediments such as licensing and quotas on either imports or exports. The tariff policy of the government aims at providing a transparent and predictable framework for all stakeholders in the foreign trade sector.

Sri Lanka’s present tariff structure range from zero to ​30​% under a three -band tariff structure with rates being 0%, 15% and ​30​%.

Essential goods & Basic raw materials  0.0% Intermediate products 15.0% Other finished products 30.0%

Sri Lanka has granted preferential tariff benefits to a wide range of products imported under the following trade agreements / arrangements.

Indo-Sri Lanka Free Trade Agreement (ISFTA)

Pakistan-Sri Lanka Free Trade Agreement (PSFTA)

South Asian Free Trade Area (SAFTA)

Asia-Pacific Trade Agreement (APTA) - formerly known as Bangkok Agreement

Being a pioneer member of the GATT and the WTO, Sri Lanka remains fully committed towards pursuing a rule based multilateral trading system that will ensure a transparent and predictable trading environment to the international business community.

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Ms. Dexter and Mr. Simrany auctioning the drawing created by Boston surrealist artist Julian

Despite the highly unpredictable weather conditions associated with Hanna and Ike hurricanes, many tea lovers flocked to the prestigious Boston Park Plaza Hotel & Towers in the afternoon of last Sunday, 7th September to witness a specialty Ceylon tea auction, which aimed at raising funds for the Tsunami-affected children in Sri Lanka. The event was jointly created by the editor/publisher of the well-known “Tea A Magazine”, Ms. Pearl Dexter and the famous tea sommelier of the Boston Park Plaza Hotel & Towers, Ms. Cynthia Gold in close collaboration with the Tea Association of the USA, Inc. in New York and the Embassy of Sri Lanka in Washington D.C.. Mr. Joseph Simrany, President of the Tea Association of the USA, Inc. and Mr. Nimal Karunatilake, Minister (Commercial) of the Sri Lanka Embassy were in Boston over the week-end to support the charity auction. Full Story The Embassy is pleased to post on its website the following pages of the 2008 Summer issue of the "Tea"- A Magazine, which carries an article on the first ever Ceylon tea auction, held on the US soil. All proceeds from the auction were donated to a Tsunami related charity in Sri Lanka. Click here to read

The Ceylon Chamber of Commerce in association with the Ministry of Foreign Affairs and other relevant organizations is organizing the Sri Lanka Investment and Business Conclave 2017 in Colombo from 30th May – 01st June 2017.

Name Title Company
Peter Barcha Vice President Aurora Associates International
William E. Beckner Executive Vice President PDI Program Development International, LLC
Dr. Herbert Davis South Asia Affairs U.S. Chamber of Commerce
Gad Demry Senior Vice President for Production Gloria Vanderbilt
Jack W. Gehring Manager International Div. Caterpillar Inc
Angela Hoffmann Director of International Trade - National Government Relations Wal Mart
Sanjay Kumar Chairman & CEO Computer Associates International Inc
Lance Graef Vice President for Trade and Investment Nathan Associates
Uri Litvak Univeslanka Corporation
Ana Claudia Lopez South Asia Affairs U.S. Chamber of Commerce
David Merill Senior Vice President Nathan Associates
Karen Muir Asst. Vice President-Program Coordination International Executive Service Corps
Kikko Okajima Murray Vice President-Asia Pacific Region Riggs Bank N.A.
Luiz Olveira South Asia Affairs U.S. Chamber of Commerce
Garry Pigg Director - Business Development IMC Global Inc.
Joseph Ratnayake CEO Akxel Corporation
Mark J. Riedy Partner Pillsbury Winthrop, LLP
Andrew J. Samet Of. Counsel Sandler, Travis & Rosenberg, P.A.
Dr. Mark J. Simpson South Asia Affairs U.S. Chamber of Commerce
Tony Weeresinghe CEO/Managing Director Millennium, Information Technologies
Aram Zamgochian South Asia Affairs U.S. Chamber of Commerce