Prospects for the Textile and Clothing Industry in Sri Lanka - 2010 edition
The textile and clothing industry in Sri Lanka accounts for almost half of the country’s exports and nearly a tenth of its gross domestic product (GDP). In addition, it provides direct employment for 300,000 people. However, the clothing sector, which accounts for bulk of the industry, is overdependent on imports for its supplies of textile materials. Also, most producers lack design, marketing and product development skills. As a result, their business is at risk from firms in larger clothing producing countries—notably China and India—which are able to source their own inputs quickly and cost effectively.
On the positive side, Sri Lanka has a number of advantages—including low wage levels, a young and well educated population and a high literacy rate. Also, it has a skilled workforce which is capable of producing quality products. Exporters benefit from good seaport facilities in Colombo, and a new port being built in Hambantota will be conveniently placed for shipping routes from South-East Asia to Europe. Also, the country’s internal transport infrastructure will improve when three major road building projects are completed. The industry benefits from strong government support in the form of investment incentives and a number of established and fully serviced industrial zones, estates and parks. There is also the privately-owned “eco-sustainable” MAS Fabric Park spread over 165 acres. Export growth has been spurred by preferential trade agreements with the USA and the EU, and important relationships have been established with well known brands such as Gap, JC Penney, Macy’s, Marks and Spencer (M&S), Next, Tesco, Tommy Hilfiger and Walmart. Until recently, Sri Lankan garments were permitted to enter the EU duty-free under the EU’s GSP+ scheme. But in August 2010 GSP+ status was withdrawn because of allegations that Sri Lanka had failed to meet certain conditions concerning human and labour rights. To counter negative perceptions and highlight the country’s relatively good labour conditions, a branding campaign has been launched under the slogan “garments without guilt”. Also an Asian Development Bank (ADB) study has shown Sri Lanka to be in compliance with internationally agreed labour standards. Perhaps the most positive development, however, is the prospect of relative social and political stability now that the ethnic conflict with the Tamil Tigers has been brought to a close.
On the positive side, Sri Lanka has a number of advantages—including low wage levels, a young and well educated population and a high literacy rate. Also, it has a skilled workforce which is capable of producing quality products. Exporters benefit from good seaport facilities in Colombo, and a new port being built in Hambantota will be conveniently placed for shipping routes from South-East Asia to Europe. Also, the country’s internal transport infrastructure will improve when three major road building projects are completed. The industry benefits from strong government support in the form of investment incentives and a number of established and fully serviced industrial zones, estates and parks. There is also the privately-owned “eco-sustainable” MAS Fabric Park spread over 165 acres. Export growth has been spurred by preferential trade agreements with the USA and the EU, and important relationships have been established with well known brands such as Gap, JC Penney, Macy’s, Marks and Spencer (M&S), Next, Tesco, Tommy Hilfiger and Walmart. Until recently, Sri Lankan garments were permitted to enter the EU duty-free under the EU’s GSP+ scheme. But in August 2010 GSP+ status was withdrawn because of allegations that Sri Lanka had failed to meet certain conditions concerning human and labour rights. To counter negative perceptions and highlight the country’s relatively good labour conditions, a branding campaign has been launched under the slogan “garments without guilt”. Also an Asian Development Bank (ADB) study has shown Sri Lanka to be in compliance with internationally agreed labour standards. Perhaps the most positive development, however, is the prospect of relative social and political stability now that the ethnic conflict with the Tamil Tigers has been brought to a close.
SUMMARY INTRODUCTION TO THE TEXTILE AND CLOTHING INDUSTRY IN
SRI LANKA AND ITS IMPORTANCE TO THE NATIONAL ECONOMY
DEVELOPMENT OF THE TEXTILE AND CLOTHING INDUSTRY IN
SRI LANKA
SRI LANKA: GEOGRAPHICAL, POLITICAL AND ECONOMIC
PROFILE
Geographical profile
Political profile
Economic profile
SRI LANKA: INFRASTRUCTURE
Roads
Railways
Ports
Airports and airlines
Telecommunications
SRI LANKA: HUMAN RESOURCES
SIZE AND STRUCTURE OF THE TEXTILE AND CLOTHING
INDUSTRY IN SRI LANKA
Textiles
Clothing
SRI LANKA: TEXTILE AND CLOTHING PRODUCTION
PRODUCTION TECHNOLOGY AND MACHINERY IN SRI LANKA’S
TEXTILE AND CLOTHING INDUSTRY
SRI LANKA: TEXTILE AND CLOTHING EXPORTS AND IMPORTS
Exports
Imports
FOREIGN INVESTMENT IN SRI LANKA’S TEXTILE AND
CLOTHING INDUSTRY
Foreign investment
SRI LANKA: GOVERNMENT POLICIES AND INVESTMENT
INCENTIVES FOR THE TEXTILE AND CLOTHING INDUSTRY
Government policies
Investment incentives
TEXTILES AND CLOTHING IN SRI LANKA: STRENGTHS,
WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT)
Strengths
Weaknesses
Opportunities
Threats
SRI LANKA AND ITS IMPORTANCE TO THE NATIONAL ECONOMY
DEVELOPMENT OF THE TEXTILE AND CLOTHING INDUSTRY IN
SRI LANKA
SRI LANKA: GEOGRAPHICAL, POLITICAL AND ECONOMIC
PROFILE
Geographical profile
Political profile
Economic profile
SRI LANKA: INFRASTRUCTURE
Roads
Railways
Ports
Airports and airlines
Telecommunications
SRI LANKA: HUMAN RESOURCES
SIZE AND STRUCTURE OF THE TEXTILE AND CLOTHING
INDUSTRY IN SRI LANKA
Textiles
Clothing
SRI LANKA: TEXTILE AND CLOTHING PRODUCTION
PRODUCTION TECHNOLOGY AND MACHINERY IN SRI LANKA’S
TEXTILE AND CLOTHING INDUSTRY
SRI LANKA: TEXTILE AND CLOTHING EXPORTS AND IMPORTS
Exports
Imports
FOREIGN INVESTMENT IN SRI LANKA’S TEXTILE AND
CLOTHING INDUSTRY
Foreign investment
SRI LANKA: GOVERNMENT POLICIES AND INVESTMENT
INCENTIVES FOR THE TEXTILE AND CLOTHING INDUSTRY
Government policies
Investment incentives
TEXTILES AND CLOTHING IN SRI LANKA: STRENGTHS,
WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT)
Strengths
Weaknesses
Opportunities
Threats
LIST OF TABLES
Table 1: Sri Lanka: political and economic profile, 2010
Table 2: Sri Lanka: economic indicators, 2007-09
Table 3: Sri Lanka: yarn production, 1990, 1995 and 2000-09
Table 4: Sri Lanka: fabric production, 2005-09
Table 5: Sri Lanka: clothing production, 2006-09
Table 6: Sri Lanka: imports of textile and clothing machinery, 2001-09
Table 7: Sri Lanka: textile and clothing exports, 2001-09
Table 8: Sri Lanka: textile exports by type, 2006-09
Table 9: Sri Lanka: clothing exports by leading destination, 2004-09
Table 10: Sri Lanka: clothing exports to the EU by leading destination, 2005-09
Table 11: Sri Lanka: textile and clothing imports, 2001-09
Table 12: Sri Lanka: textile and clothing imports by leading supplying country, 2008 and 2009
Table 13: Sri Lanka: yarn imports, 2003-09
Table 14: Sri Lanka: fabric imports, 2001-09
Table 15: Sri Lanka: fabric imports by major supplying country, by value, 2009
Table 16: Sri Lanka: fabric imports by major supplying country, by volume, 2009
Table 17: Sri Lanka: imports of materials and accessories for the garment industry, 2003 and 2006-08
Table 18: Sri Lanka: textile machinery imports by major supplying country, 2007-09
Table 19: Sri Lanka: clothing machinery imports by major supplying country, 2007-09
Table 20: Sri Lanka: foreign investment in the textile and clothing industry, 2000-09
Table 21: Sri Lanka: investment incentives
Table 22: Sri Lanka: investment incentives for the textile industry by area
Table 23: Sri Lanka: investment incentives for the clothing industry by area
Table 1: Sri Lanka: political and economic profile, 2010
Table 2: Sri Lanka: economic indicators, 2007-09
Table 3: Sri Lanka: yarn production, 1990, 1995 and 2000-09
Table 4: Sri Lanka: fabric production, 2005-09
Table 5: Sri Lanka: clothing production, 2006-09
Table 6: Sri Lanka: imports of textile and clothing machinery, 2001-09
Table 7: Sri Lanka: textile and clothing exports, 2001-09
Table 8: Sri Lanka: textile exports by type, 2006-09
Table 9: Sri Lanka: clothing exports by leading destination, 2004-09
Table 10: Sri Lanka: clothing exports to the EU by leading destination, 2005-09
Table 11: Sri Lanka: textile and clothing imports, 2001-09
Table 12: Sri Lanka: textile and clothing imports by leading supplying country, 2008 and 2009
Table 13: Sri Lanka: yarn imports, 2003-09
Table 14: Sri Lanka: fabric imports, 2001-09
Table 15: Sri Lanka: fabric imports by major supplying country, by value, 2009
Table 16: Sri Lanka: fabric imports by major supplying country, by volume, 2009
Table 17: Sri Lanka: imports of materials and accessories for the garment industry, 2003 and 2006-08
Table 18: Sri Lanka: textile machinery imports by major supplying country, 2007-09
Table 19: Sri Lanka: clothing machinery imports by major supplying country, 2007-09
Table 20: Sri Lanka: foreign investment in the textile and clothing industry, 2000-09
Table 21: Sri Lanka: investment incentives
Table 22: Sri Lanka: investment incentives for the textile industry by area
Table 23: Sri Lanka: investment incentives for the clothing industry by area
