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Sri Lanka to continue talks as US tariff cut seen as ‘good start’
10 Jul, 2025
Sri Lanka expects to continue negotiations with the US after President Donald Trump’s decision to reduce tariffs on the island nation is seen as a “good start” by Colombo which had primarily negotiated to preserve its competitive advantage, Treasury Secretary Harshana Suriyapperuma said Thursday (July 10).
US President Donald Trump imposed a 30 per cent levy on goods from Sri Lanka after the July 9 deadline passed without a deal in place. The new tariff is lower than the earlier 44 per cent imposed on Sri Lanka, and also below the 35 per cent and 36 per cent levied on countries like Bangladesh and Cambodia respectively which compete to ship a similar basket of goods.
Sri Lanka will continue to engage with the US on tariff issues, Suriyapperuma said at a press conference. Central Bank Governor Nandalal Weerasinghe added that maintaining a relatively competitive position against other countries was the first aim of negotiations, an objective the country has achieved.
Sri Lanka negotiated in good faith to expand trade and imports, which the US has recognized, Weerasinghe said, adding his government will also monitor and take into account for future negotiations how other countries are achieving benefits from their talks.
Trump unveiled a new round of levies on countries, including Sri Lanka, for the tariffs which are set to hit in August. Officials from the island nation were hoping for a positive outcome after multiple rounds of discussions with Washington.
The latest levies will add some pressure on economic recovery for the nation that defaulted on its debt in 2022. The International Monetary Fund recently warned that trade risks can hit Sri Lanka’s growth by as much as 1.5 per cent.
Sri Lanka’s economy is heavily reliant on the US market for exports, with US$3 billion worth of goods, mostly garments, shipped last year. In the first five months of 2025, goods exports to the US were US$1.18 billion, up 5.6 per cent from a year earlier. (Bloomberg)
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