Apparel generated US$ 446 Mn in May 2022, as compared with US$ 344 Mn in May 2021
Industry hopeful of achieving US$ 6 Bn target, as cumulative apparel earnings rise to US$
2.2 Bn
Urges Government to channel greater support to SME apparel producers
Repeats demand for immediate reforms to secure political and economic stability
Reiterates industry’s commitment to supporting the nation through ongoing crisis
7 th July 2022: The Joint Apparel Association Forum (JAAF) thanked all industry stakeholders for
their outstanding resilience in ensuring that the sector continued to meet its commitments in the
face of unprecedented challenges, as apparel export earnings expanded by 30% Year-on-Year
(YoY) up to US$ 446 million in May 2022.
Accounting for approximately 6% of Sri Lanka’s Gross Domestic Product (GDP) and almost half
of all merchandise exports, the apparel sector serves as a bulwark of the nation’s economy.
While the sector continues to face significant limitations from continuing disruptions in energy
supply and logistics, cumulative export earnings from the sector increased by 16% YoY up to
US$ 2.2 billion as at May 2022.
“We are still hopeful of achieving the sector’s target of US$ 6 billion by the end of 2022,
however we acknowledge that there are significant obstacles ahead that we will first have to
overcome. It is therefore essential that all possible support is provided to the sector to continue
operating.
“In addition to ensuring that large manufacturers are able to maintain production, much more
needs to be done to prioritize support for SME apparel producers, who are an equally essential
component of the industry that is also facing severe challenges in day-to-day operations.” JAAF
Secretary General, Yohan Lawrence stated.
Despite unprecedented domestic volatility, unstable global market conditions and escalating raw
material and logistics costs, Sri Lanka’s apparel sector has provided extraordinary support to
the national economy, including direct surrender of export proceeds to the Government.
“All apparel companies receive payments through the formal banking system, which is visible at
all times to the Central Bank. Once they receive these funds, they are permitted to use these
dollars to fund raw material imports, which in previous years stood at approximately US$ 2.5
billion annually,”
“On a monthly basis, the balance of our industry’s export proceeds are then converted into Sri
Lanka Rupees. Once converted, the dollars are then available within the banking system to go
towards payments for essential imports such as fuel, gas, food and medicine,” Lawrence
explained.
These extraordinary measures have been commended by the Prime Minister’s office as having
provided vital assistance in mitigating issues around energy, transport and healthcare in the
country.
PRESS RELEASE
“Moving forward, the apparel industry remains totally committed to doing all we can to help our
nation move past this unprecedented crisis. There is still a great deal of potential for new
investments, and capacity expansions including domestic production of raw materials to supply
our manufacturing base. Such development hinges on the extent to which the Government
delivers on the wide-spread and clear demands of the Sri Lankan people for meaningful
economic and political reforms,” Lawrence reiterated.
Despite the ongoing crisis, the outlook for Sri Lankan apparel is still considered positive, as
evidenced by the continuing Foreign Direct Investment (FDI) inflows to Sri Lanka which have
mirrored upward trends in export performance, recording 17% YoY growth up-to June 2022. At
present, US$ 73 million worth of investments have been committed for expansions in the
apparel sector in 2022, out of a total apparel investment pipeline of US$ 94 million.
“We are extremely grateful to all our employees for their commitment towards keeping the
industry running, against all odds. We will continue to work hard to maintain our global
reputation as a reliable sourcing destination for high-end apparel, while also doing our utmost to
support the economy at this time,” Lawrence stated.
ENDS