Sri Lanka’s apparel industry ‘concerned’ over crippling tariff on US imports

Sri Lanka’s apparel industry has expressed its concern over the Reciprocal Tariff policy announced by the U.S regime earlier on Thursday, which would significantly disrupt the country’s largest export sector and put thousands of jobs at risk.

Following an announcement by US President Donald Trump on April 2, a 10 per cent baseline tariff on all imports will take effect from April 5, increasing to a 44 per cent “reciprocal” tariff on Sri Lankan exports, starting April 9, the Joint Apparel Association Forum (JAAF) said in a statement

“This tariff level is extremely high relative to our regional competitors,” said JAAF Secretary General Yohan Lawrence. “Sri Lanka could very quickly see its share of US business move to countries with lower tariffs than Sri Lanka has”.

The US is Sri Lanka’s largest single-country apparel market, accounting for over 40 per cent of the sector’s total exports, which exceeded US$5.5 billion in 2023.

“With tariffs coming into effect almost immediately, the impact will be swift and severe. Potentially, we could see the bulk of our U.S. business migrate to competitor markets,” Mr. Lawrence added. “This volume of business simply cannot be replaced through other markets.”

JAAF said the Government of Sri Lanka has already initiated consultations with the industry and other stakeholders to determine an appropriate course of action.

“We are very appreciative of the immediate actions taken by the Government to discuss this situation are working very closely with the authorities to see how best we could address the concerns raised by the US Government, whilst staying within the limitations of Sri Lanka’s ongoing IMF programme,” said Mr. Lawrence.