June 19 – The United Kingdom’s new Developing Countries Trading Scheme (DCTS), which will replace the current Generalised Scheme of Preferences (GSP), takes effect from today (19 June), the British High Commission in Sri Lanka announced.
The DCTS is meant to replace the Generalized Scheme of Preference+ (GSP) and allows Sri Lanka to trade with the UK tariff-free on 92 percent of goods, leading to increased competitiveness of Sri Lankan products in the UK market, according to the High Commission.
In addition, over 150 additional products will be brought into the scope of the new scheme, including milled grains, pet food products and dairy products.
The British High Commission in Colombo said the new scheme DCTS was designed to grow free and fair trade with 65 countries, including Sri Lanka.
The DCTS intends to create jobs and boost the economies of these countries, offering one of the most generous sets of trading preferences in the world and demonstrating the UK’s commitment to building long-term, mutually beneficial relationships with countries like Sri Lanka.
UK officials, promoting the DCTS, had earlier showcased high-potential value chains and products that can benefit from the new scheme. This was based on research into UK retailers’ and consumers’ buying considerations, as well as insights from Sri Lankan producers, trade programmes and policymakers.
Earlier on August 16, 2022, Britain launched a scheme to extend tariff cuts to hundreds of products, such as clothes and food, from developing countries including Sri Lanka, as part of London’s post-Brexit efforts to set up systems to replace those run by the European Union.
The DCTS would replace the UK Generalised Scheme of Preferences and will come into force on 19 June 2023. Under the scheme, Sri Lanka is eligible for zero tariffs on 92% of products. Over 150 additional products will be brought into scope of the new scheme, including milled grains, pet food products and dairy products.
British High Commissioner to Sri Lanka, Sarah Houlton OBE, commenting in this regard, said the UK’s new DCTS aims to provide Sri Lankan and UK businesses with a fresh opportunity to diversify and deepen supply chains and reduce the cost of exporting to the UK. “We hope businesses will take advantage of the great opportunities we have highlighted through our events this week.”
Meanwhile, UK Minister of State at the Department for Business and Trade, Nigel Huddleston said: “The Developing Countries Trading Scheme will support businesses by giving them the tools to export duty-free to the UK, opening up markets and boosting consumer choice. We want to go bigger and further with our global trade links and the DCTS enables the UK to achieve this with developing countries.”
In its statement, the British High Commission said, while Sri Lanka exports numerous high value products to the UK including textiles, tea and rubber, there has been a steady decline in trade volumes between Sri Lanka and the UK since 2018. “Under UK trade preferences, Sri Lankan exports will benefit from generous tariff cuts and new products will be brought into scope, facilitating access to the UK market for Sri Lankan businesses across a wide range of industries,” it read further.