International Economic Series

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    Who stands to lose? the effects of GSP+ withdrawal on Sri Lanka's export and labour force
    (Institute of Policy Studies of Sri Lanka, 2025-03-19) Wijesinghe, Asanka; Anupama, Rashmi; Dissanayake, Chaya
    In the absence of Generalised Scheme of Preferences Plus (GSP+) tariff preference, Sri Lanka will face a tariff increase up to Most Favoured Nation (MFN) tariffs, likely resulting in export loss and associated negative labour market effects. This study estimates the export loss of Sri Lanka due to a hypothetical tariff increase from GSP+ rates to MFN rates. The labour force effect and distributional cost across diverse labour groups resulting from preference erosion are calculated in a second–stage simulation. Trade effects are weighted for the utilisation ratio as preference utilisation is below 100% and varies across sectors. The tariff hike in the EU–28 will cause an export loss of United States Dollars (USD) 1.23 billion (Bn) or 36.7% of EU–28 bound exports from the base year 2019 exports. Wearing apparel and processing fish sectors will be hit hard and face significant export losses. The fall in import demand from the EU–28 will make 4.99% of total industrial employees in Sri Lanka vulnerable to adverse labour market outcomes in line with the base year. This study also points to the differential effect of GSP+ preference erosion on women and low and medium–skilled workers, who account for 65.65% of vulnerable workers. The spatial distribution of vulnerable workforce shows a concentration of workers in rural areas with a high poverty headcount index.
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    Trade Policy Effects on Global Value Chain Participation of South Asian Countries: implications for Bangladesh - Sri Lanka trade negotiations
    (Institute of Policy Studies of Sri Lanka, 2022) Wijesinghe, Asanka; Yogarajah, Chathurrdhika
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    Unveiling trade potential:an ex-ante analysis of the Sri Lanka-Thailand free trade agreement
    (Institute of Policy Studies of Sri Lanka, 2023) Wijesinghe, Asanka; Rathnayake, Nilupulee
    Sri Lanka and Thailand are engaged in expedited negotiations for a free trade agreement(FTA) to enhance bilateral trade, facilitate trade activities, and promote investments. Anex-ante analysis employing a partial equilibrium analysis framework is conducted to assess the potential benefits and drawbacks of the agreement. The analysis considersexisting tariffs, bound tariffs, binding overhangs, and the development of offensive lists for both countries. Simulations are performed for 47 Global Trade Analysis Projects(GTAP) sectors, utilising sector-specific Armington elasticities to enhance the accuracyof the estimates.