Sri Lanka hit by low consumer spending in US, EU markets
View(s):Against the backdrop of a declining consumer spending in both the US and Europe markets Sri Lanka is receiving apparel orders to refill their old stocks with drop in orders experienced compared to last year upto June.
The expectations are that buyers will start issuing new orders in the latter part of the year, Joint Apparel Association Forum (JAAF) Deputy Chairman Felix Fernando told The Sunday Times Business.
Cumulative data for the first six months of 2024 indicated a drop of 1.18 per cent of total export income to US$2258 million from $3084 million last year. The revenues from US and EU had also dropped by 2.87 per cent and 4.42 per cent respectively. The income from the US had dropped to $875 million from $901million.
Though the industry continues to receive orders the main concern is that these are simply orders to refill the stocks as they have sold most of the others stocks, it was noted.
Both markets in the US and Europe are on the downward trend with most consumers reducing their purchases on garments, Mr. Fernando explained.
The downturn commenced last year and as a result the Sri Lankan apparel industry did not receive orders as expected. In fact factories closed operations last year and there were complete shutdowns of some of the smaller operations.
The industry believes that once the US elections conclude the markets are likely to start growing, it was noted.
Moreover, climate change has also impacted on sales as the late summer coupled with rains did not bode well for the apparel sector as many consumers were unlikely to make purchases of summer clothes.
In fact the onset of rains during June and July had also created a dip in consumers buying beachwear.
JAAF General Secretary and spokesman Yohan Lawrence told The Sunday Times Business that currently factories are reasonably busy on the reduced capacity at the plants.
The buying patterns have also changed, he noted, due to the varied concerns but the volumes have decreased as buyers continue to purchase in smaller volumes.
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