According to a report quoting a top official of the Joint clothing Association Forum (JAAF), Sri Lanka’s clothing export revenues could decline by US $ 1 billion this year as a result of the slowdown in demand in important export destinations amid growing prices and increased interest rates.
The first quarter of 2023 saw a 13.8 per cent year-over-year fall in apparel and textile exports to US $ 1.3 billion, while March exports touched a three-year low.
“Given the slowdown in demand we are seeing now, a US $ 1 billion reduction in exports this year is not unreasonable,” JAAF Secretary General Yohan Lawrence was quoted as saying.
“Our projection is it could be five to six more months before we see a recovery in global demand,” he added.
Sri Lanka’s top industrial export, apparel, brought in US $ 5.95 billion in 2022, helping the nation’s dollar-starved economy. The US, EU, and UK are the top three buyers of clothing and textiles from Sri Lanka.
Exports to the US plummeted by 22 per cent YoY to US $ 470 million in the first quarter of this year, while exports to the EU fell by 13 per cent Y-o-Y to US $ 344 million. Exports to the UK decreased by 10 per cent year over year to US $ 167.7 million.
Although the sector does not anticipate significant job losses as a result of the downturn, small and medium-sized businesses may face challenges as the industry adjusts to a slowdown in orders. The apparel sector has about 300,000 employees, most of whom are women.
