International apparel manufacturers eye Colombo again
View(s):Apparel manufacturers based in Europe and China currently are likely to expand on their businesses in Sri Lanka if state plans to revive EU GSP plus prove fruitful by next year.
The government has been in discussion with the European Union (EU) authorities to ascertain how to revive the GSP plus trade concessions to Sri Lanka that would likely be implemented in 2016.
In the wake of these developments overseas based apparel manufacturers in Sri Lanka were likely to expand their capacity here, Sri Lanka Apparel Exporters Association Chairman Saiffuddin Jafferjee said in an interview with the Business Times this week.He noted that some European investors already here were keen on expanding their production if GSP plus concessions were able to pull through.
It was pointed out that in addition, investors already manufacturing out of China would also want to expand on their capacity in Sri Lanka as it is believed that the latter is becoming more competitive.
Mr. Jafferjee explained that with China increasing on its labour wages and in comparison Sri Lanka seems more competitive at lower rates, manufacturers would want to cash in on the opportunities to get access to the EU markets when the EU GSP plus concessions were revived.
Further, there is increased local investments taking place in the North and East with approximately 6-8 factories employing over 1000 per factory opening up in these areas that were once restricted, the apparel chief said.
He also noted that this could help in the “reconciliation process by creating economic development in these areas.”
The industry is currently awaiting talks to be finalized between the government and the US authorities on the possibility of gaining market access especially through negotiations underway on the Trans Pacific Countries that could impact on Sri Lanka trade if this agreement was to go ahead.
Mr. Jafferjee said they were working with the government through the Joint Apparel Association Forum (JAAF) to gain market access for the industry based on industries of scale and critical mass in order to remain relevant in the market.
Moreover, he noted that Sri Lanka is currently looking at re-gaining its hub status in line with its previous plans for the apparel sector since they were positive about obtaining the GSP plus concessions.