29 May 2023 12:14 am Views - 426
The Joint Apparel Association Forum (JAAF) expects the current slowdown in apparel export orders to continue for the rest of the year.
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Yohan Lawrence |
“We have been experiencing a reduction of around 20 percent in orders due to a global slowdown for past seven months. We think this will continue for another 5-6 months,”JAAF Secretary General Yohan Lawrence said.
He pointed out that other key apparel exporters such as Vietnam, China, and Bangladesh are also grappling with the same problem along with Sri Lanka as key markets including United States (US), European Union (EU) and United Kingdom are currently facing an economic slowdown coupled with high inflation which has resulted in reduction of export orders.
In addition, Lawrence noted that some of the retailers are not placing new orders as they already have excessive inventories which were accumulated during the pandemic period.
In order to face the new reality, he acknowledged that apparel exporters are making necessary adjustments which could include reduction in working hours and freeze in new recruitment.
However, he ruled out that the vast majority of exporters are unlikely to make extreme adjustments which could include closure of factories leading to loss of employment.
“There will be some readjustment when there’s a reduction of 20 percent in orders. The industry stopped recruitment 6-7 months ago,” he added.
Meanwhile, State Minister of Investment Promotion, Dilum Amunugama stressed that the government is ready to provide relief to apparel exporters in this critical time period to make necessary adjustments while retaining their workforce.
Lawrence welcomed the government’s efforts in pushing for new FTAs with China and India along with the recent announcement to join the Regional Comprehensive Economic Partnership (RCEP), which is set to open new markets for Sri Lankan exporters.
According to EDB, earnings from export of Apparel & Textiles decreased by 15.94 percent to US$ 1.61 billion during the period of January to April 2023 compared to the same period of 2022.