• Total value of exports under agreements increased, but percentage of overall exports declined
• GSP remains largest contributor, while new FTA with Thailand signed during the year

Sri Lanka’s total exports share under trade agreements fell in 2024, despite new trade agreements signed in the year as the percentage dropped to 38.9% from 40.1% in 2023, data by Central Bank of Sri Lanka (CBSL) showed.

According to CBSL’s annual economic review, the country’s total exports value under trade agreements increased by 4.2% year-on-year in 2024 to $ 4.97 billion, while that value as a share of total exports fell to 38.9%.

This indicates an increase in exports outside preferential trade agreements during 2024.

As usual, the highest value of exports was recorded under GSP at $ 3.98 billion, as GSP eligible exports since the US-GSP expired on 31 December 2020, stood at $ 741.6 million and $ 601.9 million were exported to the UK under GSP.

Sri Lanka signed its fourth bilateral free trade agreement (FTA) with Thailand (SLTFTA), while negotiations for several other FTAs continued during 2024.

The SLTFTA was signed in February 2024, which is a comprehensive FTA covering both trade in goods and services, as well as investments, customs procedures, intellectual property rights, and more.

Moreover, exports under the Indo-Sri Lanka Free Trade Agreement (ISFTA) declined to $ 490.3 million in 2024 from $ 536.4 million in 2023, although exports to India under South Asian Free Trade Area (SAFTA) increased.

Trade under the Pakistan-Sri Lanka Free Trade Agreement (PSFTA) remained muted, while performance under other regional trade agreements, such as the Global System of Trade Preference (GSTP) declined by 11.4% and Asia Pacific Trade Agreement (APTA), declined by 1.9% in 2024.

CBSL said Sri Lanka continued to benefit from the Generalised System of Preference (GSP) schemes offered by its key trading partners, such as the EU and the UK. To ensure continuity, the EU-GSP scheme was extended in September 2023 by the European Commission (EC) for the period 2024-2027.

“As a result, Sri Lanka continued to benefit under GSP+ Scheme of the EU during 2024 and recorded a moderate growth. Moreover, negotiations among the EU countries on the terms of a new GSP scheme continued during 2024,” the report said.

Also, it said that the US-GSP scheme, which expired in December 2020, has not yet been reinstated by the US Government, although it is expected to be reinstated on a retroactive basis as per the general practice, unless there is a major policy shift introduced by the new US Government.