Sri Lankan industries able to excel sans GSP+

Charumini de Silva

Sri Lankan industries have the ability to excel even without the General System of Preference (GSP+) concession. The GSP+ concession was indeed a bonus for the industries to enter into the international market, yet we cannot depend on concessions everlastingly, Dial Textile Industries (Pvt) Ltd., Managing Director, Neil Umagiliya told Daily News Business.

Sri Lanka’s labour cost is relatively low compared to the East European labour, which is 1/10th of the European labour cost. This situation is an advantage as there are many productions being done in Europe.

The industries now should focus on enhancing their productivity to 85 to 90 percent. If they are capable of improving their productivity and quality of the products at the meantime the buyers would still demand for their supply even without the concession, he said.

With the cost of labour increasing rapidly in the East European countries, there is much potential for investments to flow into the country. At present there are around 5,000 job opportunities within the Katunayake investment promotion zone.

He said, “Our buyers are willing to demand for the products as we have maintained a high level of productivity, quality and timely delivery. This is equal to the other companies too since these are fundamentals of building better linkage with the buyers.”

However, finding labour, at present has become a little difficult. The main reason for this is that people still have not given the proper recognition to the people who are engaged in these industries. The majority of the foreign remittances are from women working in the Middle East countries and the flagship export industry that has surpassed US$ one billion is the apparel industry, he said.

Umagiliya said the women working force plays a key role in the economy, but their contribution to the country has still not been recognized. The attitude of the people has to change. All these employees are given a living wage unlike in other countries in the Asian region.

“Fifty vacancies exist at any time at Dialtex. The employment rate in Gampaha district is 99.9 percent. Therefore, Dailtex has to seek employees from outside the district and province. At present our production capacity is 8,500 jeans per day and we are expecting to increase it up to 10,000 by next year.

We are exploring new markets such as Australia, the Middle East countries and China, but will not be starting exports immediately. The performance of the company last year was commendable and was within the budget. We will focus on the same this year while meeting all the changes. This year we have invested US$ 3.2 million. Dialtex is also expecting to set up a factory by next year in the Puttalam district,” he said.