Sri Lanka’s apparel industry will not face a major threat with the withdrawal of GSP plus as the majority of exports do not qualify for EU concessions, Chairman, Joint Apparel Associations Forum, A. Sukumaran said.
According to Sukumaran, two thirds of the apparel exported to Europe does not qualify for GSP Plus concessions.
"There maybe a decline of about 15 percent to 20 percent which may lead to some closures, but there is a shortage of labour so those who lose their jobs would be absorbed into other factories," he said addressing the Sri Lanka Economic Summit earlier this week.
Under GSP Plus, only a 9 percent tariff reduction is provided. "We should formulate a marketing plan to pass down the burden on to consumers through negotiations with buyers, he said.
Meanwhile, Sukumaran said that the industry was not worried about the US inquiry into labour rights, as the US GSP did not apply to apparels. However, the appreciation of the rupee, a shortage of labour and costs rising at 12 to 15 percent were threatening the stability of the apparel industry.
Sukumaran was optimistic however, that the industry would reach the US$ 4 billion export earnings mark by 2015.
source - www.island.lk
photo credit - www.island.lk
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