L. Peiris, told parliament this week that Sri Lanka was vehemently opposed to the use of GSP Plus as a weapon.

ECONOMIST: Sri Lanka and the EU

But there is a problem with the rules of GSP Plus.

ECONOMIST: Sri Lanka

Seemingly hoping to appear unaffected, the central bank denied in a statement that the loss of GSP Plus would have an adverse impact on Sri Lanka's exports.

ECONOMIST: Sri Lanka and the EU

Under a trade deal with the European Union called GSP-plus, Sri Lanka's garment exports (its second-largest source of foreign exchange) enjoy duty-free access to the EU. But GSP-plus hinges partly on human rights.

ECONOMIST: Sri Lanka