The Coronavirus threat in China has further dealt a crippling blow on Sri Lanka’s apparel industry with 50 factories or more being threatened with temporary closure.
We are going through what would be a major crisis which should be resent for the next three months as nearly 50% of our members are threatening closure, at least temporarily due to the uncertainty prevailing over the supplies of raw materials to factories from China, Chairman of the Sri Lanka Apparel Exporters’ Association Rehan Lakhani told Daily News Finance.
Most of our Association members get their raw materials such as Fabric, Accessories such as Zippers, Labels etc from China and the Coronavirus has adversely impacted our supplies and suppliers.
“It is our assessment that Sri Lanka’s losses in export revenue would be in the region of between US $ 200,000 and 500,000 up to about May 2020,” he said.
Lakhani said that the Association would soon make an assessment of the impact on the industry till about May 2020.
He said that the Association would also make a study soon about the existing supplies and suppliers of raw materials, claiming that there might be difficulties in finding alternative suppliers from the already contracted suppliers. He also explained that there would be difficulties in locating new markets and buyers in Western countries such as Italy which has been affected by Coronavirus.
He also explained that there was a lot of uncertainty among the local manufacturers about the suppliers’ backdrop. He said that he was hearing reports about China claiming that it was back to normal but some were saying that the Chinese raw material manufacturers were still having limited labour supplies.
He said that Sri Lanka earned US $ 5.3 billion in 2019 as apparel export revenue which was a 5.3% Year On Year Growth, but loss of production even for a single month, would make those figures difficult to attain.
He said that the association would be meeting often to deliberate what representations to make to the Government on these matters.
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