Apparel industry gearing to hit $ 5 b target by 2015
JAAF says Government endorses apparel industry initiatives through new development policy framework
Sri Lanka’s apparel industry said yesterday that it would be launching an industry growth drive in 2011 and an awareness campaign to increase apparel export incomes to US$ 5 billion in 2015.
“Sri Lanka’s apparel industry continues to manufacture world-renowned quality apparels for global brands. It has always adhered to ethical practices and environment standards. The industry has huge potential to become a US$ 5 billion industry. Towards this, further facilities will be arranged to promote entrepôt trade involving imports, processing and re-exports as well as transhipment business in apparel clothing. Incentives have been given to promote textile, apparel and leather product related high value added activities. As such, machinery and equipment to manufacture textile, leather, footwear and bags will be exempted from import duties and VAT,” said President Mahinda Rajapaksa in the Budget speech in November 2010.
“The Government also plans to attract leading buyers to establish their headquarters in Sri Lanka for management, finance, supply chain and billing operations. I also propose to exempt foreign exchange earnings from such activities from income taxes. In order to promote these activities, the exchange control requirements and Custom procedures will be simplified.”
In addition, the Government’s latest development policy framework, based on the ‘Mahinda Chinthana’ from the Department of National Planning of the Ministry of Finance and Planning, titled ‘Sri Lanka, the Emerging Wonder of Asia,’ has also earmarked the apparel industry for growth.
The national development policy framework notes that the apparel and textile industry is a significant contributor to the Sri Lankan economy with the highest net foreign exchange earnings. In 2009, export incomes from the sector accounted for 46% of total export incomes of the country at US$ 3.262 billion.
The policy framework notes that local apparel manufacturers must develop new products to overcome increasing competition in international markets and to remain competitive.
“Three textile processing zones will be established in order to enhance the value addition in apparel exports. Special emphasis will be paid to product diversification and to produce raw fabrics, other raw materials and accessories to feed the apparel industry,” says the ‘Sri Lanka, the Emerging Wonder of Asia’ policy framework.
The industry has already positioned itself as an ethical manufacturer of apparel among its local and international stakeholders.
“As pioneers in ethical business practices, passionate advocates of ‘Garments without Guilt’ and home to the world’s first green factories, it is obvious how committed we are towards our social and ecological responsibilities,” said the Joint Apparel Association Forum (JAAF) spokesperson.
The JAAF notes that Sri Lanka has always been among the most progressive in the world when it comes to ecological awareness and responsibility. With numerous programmes that include marine conservation and preservation, Sri Lanka has always stepped up for the environment.
The Sri Lankan apparel industry also offers three other major advantages to international buyers. The first and foremost being the speed of delivery, based on Sri Lanka’s unique geographical location, the industry’s vertical integration and interconnectivity within the country. “From manufacturing to logistics, Sri Lanka Apparel has learned to cut timelines, offering our clients the benefit of faster turnaround,” said JAAF.
The second strong point of the industry is its ability to supply world class products through the latest technologies and the capacity to innovate. “With a strong focus on building up design capabilities, the latest technologies and the capacity to innovate, Sri Lanka Apparel has been offering clients world-class products for over four decades,” said JAAF.
The third advantage offered by the apparel industry is Sri Lanka’s favourable business policies and investor climate.
“Sri Lanka is ranked the most liberalised economy in South Asia. Investors are provided with preferential tax rates, constitutional guarantees of investment agreements, exemption from exchange control and 100% repatriation of profits. Total foreign ownership is welcome in almost all areas of the economy with only a few areas limited or restricted to foreigners,” JAAF noted. The JAAF states that the apparel industry growth drive, supported by its awareness building campaign, will directly contribute towards increasing apparel export incomes to US$ 5 billion by 2015.
Last Updated ( Thursday, 13 January 2011 )