SLPA to provide 200 acres for free port area:

JAAF seeks apparel hub

Deregulation of the industry being explored:

Ravi LADDUWAHETTY

The Joint Apparel Association Forum (JAAF) has urged the government to set up a knowledge-based apparel hub in Sri Lanka. It is confident of an additional annual revenue to the country of $ 1 billion through this move.

Sri Lanka’s apparel companies which are at the high end of the market would be able to create additional business by providing hub services to low-cost countries in the region providing high value services both at the front end and the back end and from this new model of business. Conceptualizing designs and developing them into proper products are some of the front end services that could be provided while the value addition for garments from the region and the logistics support to buyers would be the back end services.

Some of the far reaching measures that JAAF has proposed to the government is the creation of a hub service by the industry with its close proximity to low cost destinations in the region that would enhance the possibility of the export turnover target increasing by a further billion dollars, JAAF Secretary General MPT Cooray told Daily News Business yesterday.

“It is the provision of these high value added services that has enabled Singapore and Hong Kong to reach high competitiveness and that has been recognized by the IMD World Competitiveness Rankings in 2010 in which textiles and apparel have played a major role. That is the model we want for Sri Lanka,” Cooray said.

“The Sri Lanka Ports Authority (SLPA) is expected to clear the free port area of around 200 acres which will initially house these activities,” Cooray said

The hub services that JAAF has proposed to the Government includes the creation of entrepot trading in the apparel sector involving import simple processing and re-export, which means that cargo imported to Sri Lanka could be processed at the port itself such as labelling and packing and exported. “Some of the other areas featured in this proposal is the transshipment business in apparel clothing. This will also save transit times,” he said.

Promoting leading buyers to establish regional headquarters in Sri Lanka for the management of finances, supply chain and billing operations is another proposal.

Furthering the domestic industrial capability of getting manufacturers in low cost destinations to manufacture basic products and importing some to add value and re-export from Sri Lanka is also one of the areas which has been proposed by JAAF to government.

Cooray said the industry is also exploring possibilities of deregulation which means that the restrictions hitherto prevalent in exports hitting the local market will also be lifted.

That means that export products in the apparel sector will also be available in the local market.