Apparel exports income to hit US$ 4 b this year

The Sri Lanka Apparel Exporters Association (SLAEA) targets an export income of US$ 4 billion by the end of this year, SLAEA Chairman Yohan Lawrence told a seminar on ‘Port development in Sri Lanka’ organised by the Shippers’ Academy and the Sri Lanka Apparel Exporters Association last week.

Lawrence said that income from apparel exports will increase this year compared to 2013. Revenue from apparel exports last year was US$ 3.8 billion, a 11 percent increase compared to 2012. Apparel exports recorded remarkable growth last year despite many challenges in the global export market.

It was a tough year for exports due to the slow down in economic growth in Europe and the USA which are major markets for Sri Lankan apparel exports.

“We are confident of achieving around US$ 4 billion this year outdoing our competitors from emerging markets,” Lawrence said.

Sri Lanka exports around 40 percent of its apparel to the USA and Europe.

The high cost of production in Sri Lanka is a drawback for the export sector which competes with cheap labour markets in the region.

Bangladesh is a major exporter of apparel taking advantage of cheap labour. Sri Lanka is known for quality and ethical manufacture of garments. Sweat-shops, child labour and low wages are hallmarks of some of the apparel exporting countries in the region.

The apparel industry targeted a revenue of US$ 4 billion last year. The government has set an export target of US$ 10 billion by 2016.

The apparel industry is the largest export earner for the country.

Lawrence said that the development in the port sector is a huge boost for export growth. Port development is vital in promoting the five hub concept.

The apparel sector employs around 15 percent of the country's workforce and accounts for around half of total exports.

The design, manufacture and export of textiles and garments contribute a major share to the economy. Sri Lanka is a top exporter of garments in the region. The GSP Plus concessions was a boost for apparel exports with preferential access to EU markets.

Many experts speculated that the withdrawal of the GSP Plus scheme would adversely affect the apparel export industry in Sri Lanka.

The industry has survived without the scheme for several years and many exporters have ventured into new markets.

Sri Lanka's apparel industry began to grow significantly in the 1980s as an alternative to India's garment manufacturers, because of its open economic policy and trade and investment-friendly environment.

Under the Multi Fibre Agreement, quota regime, Sri Lanka became an attractive new venue for businesses.

- LF