Sri Lanka’s apparel industry simply got lucky with its plausible US$3.4 billion revenue in 2010 due to world developments after the EU GSP + concessions were pulled out. However, the sector continues to be plagued with wage and labour issues in the context of new sector industries coming up.
Sri Lanka in 2010 gained US$284 million from exports to some of the industry’s new markets which is a significant value of about 6-7% of total exports.
The GSP + and whether it was due to its impact or otherwise is mainly attributed to China and Bangladesh increasing its production prices while the latter also got into protracted domestic labour issues.
This placed Sri Lanka on a platform to gain on the improved environment to capture new markets inspite of the setbacks of withdrawal of trade concessions, industry experts noted.
With China unlikely to get any cheaper and Bangladesh set to become increasingly expensive the costs between China and Sri Lanka are likely to become significant, the industry notes. In this respect, this is likely to be to Sri Lanka’s advantage at present.
It was pointed out that currently the industry was plagued with a chronic labour shortage and tough competition (for a share of the labour market) against new industries post war.
Meanwhile, the industry points out there is a labour shortage exceptt in the North and East which has excess but the industry is unable to tap it due to infrastructure constraints.
In this respect, the industry is currently seeking a discussion with the Government in a bid to ensure they would establish Industrial Parks in the North and East. This is likely to create the sufficient space to attract the new labour in the area, according to a top garment industrialist, who declined to be named.
He told the Business Times that the need at present is for the industry to go rural in a bid to ensure they are able to attract more labour from these areas.
With most other industries now coming up the apparel sector is no longer becoming an attractive industry for employment generation as a result of which they face stiff competition today.
Once the industry was the most lucrative sector the people would turn to for jobs but with new investments and business process outsourcing (BPO) operations the demand is greater in the employment sector.
On the other hand, the industry is today looking at furthering the industry’s prospects by scaling its operations to becoming a significant player from the once tailoring shops to an international designer-wear production house.
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