SL unable to share tariffs with US buyers
US apparel buyers want Sri Lankan manufacturers to consider sharing the additional 10 per cent tariff imposed by the US during the 90 day period. But Joint Apparel Association Forum (JAAF) Deputy Chairman Felix Fernando said that principally manufacturers are unable to share the tariff.In this respect, he said most exporters have agreed not to share the tariff with the buyers.
Sri Lanka’s exports to the US have been taxed between 6-32 per cent prior to the new tariffs announced this year.
The US imposed a 10 per cent tariff in addition to the existing tariffs on the import of goods from all around the world relaxing the skyrocketing tariffs imposed on countries at varied levels for a 90 day period that will end on July 8.
This new tariff has led to an additional 10 per cent import tariff on buyers of apparel from Sri Lanka as well.
With buyers unable to absorb this new tariff they have approached the Sri Lankan apparel manufacturers in a bid to negotiate a possible sharing of the US tariff equally between the buyers and the manufacturers, (JAAF) Secretary General Yohan Lawrence told the Sunday Times Business on Thursday.
However, local manufactures are unable to absorb these costs since their costs are high at present.
Sri Lanka’s apparel exports to the US grew by 5.23 per cent year on year reaching approximately US$1.9 billion in 2024. Despite this growth, the figure remains about 19.4 per cent below the 2019 pre-pandemic level of $2.36 billion.
The US continues to be Sri Lanka’s largest apparel export market, accounting for 40.04 per cent of total apparel exports in 2024.
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