Sri Lanka Reports All Time High Exports In June

Market News

Sri Lanka Reports All Time High Exports In June

Sri Lanka reported apparel exports of US$ 537 million, highest every for any month, up 39.45%, in June, despite the fragile economic situation. Exports to the US went up by 67.6% and to the EU by 24%, compared to the same month a year ago. Apparel exports in the first half of the year also showed excellent performance at US$ 2.8 billion. According to the Joint Apparel Association Forum (JAAF), June 2022 performance had beaten the previous highest for a month of US$ 504 million achieved in March 2019. From a year ago, June 2022 achievement reflects a strong 39.45% growth. In May, YoY growth was 30%. Confirming the apparel industry has not only reverted to pre-Covid resilience but bettered it, the first half figure of US$ 2.8 billion is above the US$ 2.62 billion achieved in the first of half of 2019, the industry’s best year so far with US$ 5.6 billion in exports for the full year. In comparison to the first half of 2021, the latest performance reflects a 20% growth. In 2021 apparel exports rose by 23% to US$ 5.43 billion. JAAF sources said that in June exports to the USA were up by a significant 67.6% to US$ 231.38 million while shipments to the EU (excluding exports to UK) saw a 24% increase to US$ 158.48 million. Exports to the UK were up 16% to US$ 69.52 million. JAAF also said exports to other countries too have recorded an increase of 31.52% to US$ 77.27 million in June 2022 compared to a year ago. Recently the Board of Investment (BOI) said investors continue to show interest in Sri Lanka’s apparel and textile industry despite political turbulence in the market. BOI had signed agreements worth US$ 76 million for new investments and expansions in the sector for 2022 so far. Apparel sector braves through crisis Sri Lanka’s ongoing economic and political turmoil has taken the country back in terms of development. However, the apparel sector continues to brave the storm, building a sense of togetherness. As the apparel sector targets to achieve US$ 6 billion in export earnings by the end of 2022, the industry is witnessing increased cooperation and collaboration between stakeholders. “The industry is witnessing a level of cooperation between manufacturers that we’ve never seen,” Joint Apparel Association Forum (JAAF) Secretary General Yohan Lawrance said. “Sri Lanka’s garment sector has been holding its ground through months of turmoil, even as manufacturers had to answer pressing questions from jittery investors and buyers. While matters only seem to be getting worse for the economy that was expected to come out from the implications stemming from the Covid-19 pandemic, the pressing issue at hand is the challenges faced in processing orders amidst the ongoing shortages in utilities and raw materials,” he said. According to Star Garments Group Director of Operations Jeevith Senaratne, buyers have expressed concerns on the unrest and upheaval in the country impacting economic activity. However, the local apparel sector has been successful in moving forward. “Every time there is a protest, questions are asked. We have maintained that amid every big protest we are still operating on the same scale because protestors are not trying to sabotage industry, they are making a statement to the government,” said Senaratne. Every factory operated at 100% capacity on July 9 when hundreds of thousands of protestors took to the streets, he pointed out. Policy changes were brought about which have helped ease the burden, including allowing manufacturers to buy fuel directly from suppliers using their own money, manage worker transport and obtain diesel for generators. However, concerns remain and the biggest is regarding the external shocks that are beginning to impact demand.