The Sri Lanka Apparel Exporters Association (SLAEA) wants the Government to explore the possibility of signing more trade agreements especially with countries such as Japan, Russia, Korea, Brazil, and South Africa.
Such agreements will help the apparel industry to broaden its export base and bring in valuable foreign exchange, industry officials said.
The industry has made a commitment to the Government to increase exports to the EU by US$ 500 million annually after GSP+ is restored.
“Our position is that the restoration will give some room to breathe and consolidate the industry. The GSP+ benefit we will enjoy for the next three or four years, can be used to accomplish many other medium and long term goals, which will not only be beneficial to the apparel industry, but boost all the exports from our country,” the new Chairman of SLAEA, Felix A. Fernando said. Sri Lanka should seriously consider negotiating a trade agreement with the EU, as the GSP+ can be enjoyed for a maximum of 4-5 years at most.
“Although it was disheartening to digest the current economic realities and the state of the world economy and our own economy, we value the current government’s desire to achieve sustainable development through export-led growth with globally connected value chains. Prime Minister Ranil Wickremesinghe in his Economic Statement acknowledged its importance and hoped for the revival of the industry with the restoration of GSP+. “If the proposed FTA with China can be successfully concluded, we will have a great opportunity to expand our market in China. The same cannot be said, however, about the proposed FTA with India. It is necessary to remove the quota in its totality in respect of the apparel sector if our industry is to see a significant benefit from the proposed ETCA,” Fernando said.
Speaking at the Annual General Meeting of the Association, the chairman said, “We all need to find and diversify into new markets for exports. Considering the reputation Sri Lanka has for its quality, and our inability to compete on the low-end value products which are made in neighbouring South Asian countries, we must increase the production of higher value-added products, such as formal wear and high-end outerwear.
“A few major players are investing in automation, but largely, the industry lacks automation. This will even become a critical factor in time to come, when one considers the shortage of labour in the country,” Fernando said.