Courtesy The Daily Mirror

In the conduct of negotiations for the reduction of reciprocal  tariffs, the U.S. authorities have proposed some restrictive measures  on trading with China, but Sri Lanka has declined to do so in  principle in conformity with its neutral foreign policy, the Daily  Mirror learns.   

Sri Lanka is among the countries that secured one of the  largest reductions of President Donald Trump’s reciprocal tariffs.  President Trump fired off a letter to his Sri Lankan counterpart, Anura  Kumara Dissanayake, announcing that Sri Lankan products entering the U.S.  market would be charged a 30 per cent tariff, a reduction from 44 per  cent initially announced.  

Sri Lanka currently remains happy since the tariff rate is  lower than most other countries, such as Bangladesh, Myanmar, Cambodia  and Laos which it competes in trading with the U.S. However, Sri  Lanka is perturbed over the imposition of lower tariffs on countries  such as Vietnam, which is a direct competitor to Sri Lanka in apparel  exports. 

In the letter addressed to President Dissanayake, Trump  highlighted the longstanding trade imbalance between the United States  and Sri Lanka, claiming the relationship has been far from reciprocal”  due to Sri Lanka’s tariffs, non-tariff policies, and trade barriers. He  insisted that the new tariff was necessary to address what he described  as persistent trade deficits, which he labelled a threat to U.S. economic  interests and national security.  

Starting on August 1, 2025, we will charge Sri Lanka a  tariff of only 30 per cent on any and all Sri Lankan products sent into  the United States, separate from all sectoral tariffs,” the letter  stated, adding that any attempts to bypass the tariff through  transshipment would be met with higher penalties.  

Trump further offered an incentive, saying Sri Lanka could  avoid these tariffs if Sri Lankan businesses chose to manufacture  products within the United States, promising expedited approvals for  such ventures.  

He also warned that should Sri Lanka retaliate by raising  its own tariffs, the U.S. would increase the 30 per cent levy by an  equivalent amount.   

However, the Sri Lankan government has chosen a  conciliatory approach, seeking to negotiate further with the U.S.  authorities for further reduction of tariff rates.   

According to a source familiar with negotiations, the U.S.  has proposed some restrictive measures on trading with China, but Sri  Lanka resisted it since it needs fair trading with all its partners.  The source declined to elaborate more on what was discussed.