EU optimistic of GSP+ continuation:

Lanka’s apparels world class

The apparel industry in Sri Lanka is world class. The GSP+ facility has a positive impact on the industry.

The Government needs to carry out an action plan as per the dialogue it had with the European Union. EU Delegation Head Bernard Savage said. Speaking at the 17th AGM of the Sri Lanka Garment Buying Offices Association he said there will be no break in the market access under the GSP+ facility.

“We are aware of the impact and the negative consequences. EU has stood by Sri Lanka in difficult times. We have a partnership. The temporary suspension of the facility is not a punishment,” he said.

“EU is a friend of Sri Lanka and we remain friends and hope the friendship will grow in the future”, he said.

Sri Lanka Garment Buying Offices Association Chairman Gopal K. Iyer said Sri Lanka has shown formidable resilience in withstanding the global recession.

“We have gone through turbulent times and now look forward to some respite. Much has been done in the past but more needs to be done if we are to counter the challenges that lie ahead,” Iyer said.

Total exports was 2.68 billion dollars before the expiry of the Multi- Fibre Agreement. Of this, 1.55 billion dollars was generated from exports to the US and 996 million dollars from exports to the EU.

While there was serious concern as to the fate of the industry in the post MFA phase, what occurred was rather an increase in exports and the generation of total revenue of 2.7 billion dollars.

The US exports were 1.6 billion dollars and over 1 billion dollars from EU. Sixty six percent of the total exports was shipped under the GSP+ facility scheme. Iyer requested the Government to devalue the rupee to sustain markets and be competitive. The SME sector is important and it needs support and concessions. Promotion of small players will attract buyers to Sri Lanka making the country a veritable hub for better quality garments.

The North and the East have opened for market opportunities and the industry should take action to set up factories for the growth on the industry. In 2006, Sri Lanka’s export revenue surged upward to 2.9 billion dollars with export revenue from the USA being 1.65 billion dollars and EU 1.165 billion dollars. The upward trend continued into 2007 where total revenue reached a staggering 3.2 billion dollars. However, the value for US exports showed a slight decline when compared to revenue generated from exports to EU increased to 1.5 billion dollars.

In 2008, the industry hit a new height of 3.3 billion dollars in export revenue. The decrease in exports to the US continued recording 1.5 billion dollars and from EU 1.6 billion dollars.

However, in 2009, 3.15 billion dollars was generated as total revenue from apparel exports. The share from USA was 1.3 billion dollars and from EU was 1.646 billion.

In January 2010 total revenue from exports stands at 166 million dollars out of which 68.9 million dollars has been generated from the US markets and 85 million dollars from EU.