EU’s long winters dampen apparel exports in Q 1
Retail demand in the European Union for Sri Lankan apparel was at a mere 5 per cent increase in the first quarter of this year compared to 2017. This was a drop in expectations on the back of the GSP plus trade facility that resumed in July 2017.
Sri Lanka Exporters Association (SLEA) President Felix Fernando told the Business Times on Friday that due to the long winter season in Europe the industry had observed a drop in retail demand for apparel as a result of which local exporters were unable to reach the expected increase in sales of 12 per cent. The industry was only capable of achieving a 5 per cent growth in apparel exports during the Q1 compared to the same period last year.
He noted that spring garments could not be released as most of the Europeans were slow on purchasing clothing and would rather remain indoors than go out shopping.
Reports have stated that Europe was in the grip of a “cold snap, which has sent temperatures plunging below their usual late-February levels, and sparked heavy snow showers in unusually southerly spots like Rome.” And expectations are that there could be severe weather with flooding and rains in Europe this month.
In fact another report highlighted that even April was giving the chill with temperatures dropping even in the US.
“Usually by March it clears up,” Mr. Fernando explained and noted that however, this year the situation has not been the same.
He pointed out that in 2017 they had observed a “big growth” in the EU market during the first quarter compared to 2016. April however, he pointed was a relatively low month.
During the first three months of this year the industry expected to achieve a growth of 12 per cent in apparel exports compared to last year.
However, the figures during the first quarter was up by only 5 per cent for both the US and the EU compared to last year’s sales as a result of which earnings were at US$1.269 billion.
Meanwhile, Mr. Fernando noted that the exports to other sectors like China, India and Japan had however, dropped by about 2.3 per cent.
The industry expects to achieve an increase of US$500 million more in earnings for this year compared to last year.