Sri Lanka’s garment sector ended 2024 on a positive note, but industry stakeholders are not impressed with the overall performance, saying more needs to be done to reach 2019 earnings levels.
According to the Joint Apparel Associations Forum (JAAF), using 2019 as a baseline, Sri Lanka’s apparel export performance for 2024 paints a more cautious picture than the previous “normal” pre-pandemic and pre-economic crisis years. Compared to the export earnings of US$5.3 billion recorded in 2019, last year’s performance shows a deficit of 10.3 percent.

“These clear facts highlight the need for more concentrated interventions to regain lost ground and chart a path to match and surpass Sri Lanka’s pre-pandemic export trajectory,” said JAAF.

Despite the gradual recovery, an analysis of the sector’s growth trends over the past five years demonstrates its resilience. Exports fell to US$4.1 billion in 2020 due to the pandemic-induced downturn, a 22 percent decline from 2019.

Exports temporarily picked up in 2022 as the market recovery post-COVID-19 was overestimated, but rebounded in 2023 amid global inflationary pressures and lower consumer spending. The 5 percent growth recorded in 2024 reflects both recovery efforts and the downward price pressure currently affecting the industry.

“Regaining pre-2019 levels and setting higher benchmarks is a challenge that requires a collective effort,” said JAAF Secretary General Johan Lawrence.

“Strategic investments and reforms can position Sri Lanka’s garment sector to exceed US$6 billion in export earnings and strengthen its reputation as a global leader in quality and ethical manufacturing,” he added.

The forum also stressed that local textile production is crucial for the long-term recovery and competitiveness of the industry. The Eravur Textile Zone, spread over an area of ​​over 300 acres, has been designed to support multiple verticals related to textile production. Manufacturers can set up facilities for dyeing, washing, knitting, weaving and other related processes within this dedicated area. The industry has acknowledged that this landmark project can save significant foreign exchange, reduce production time and enhance the value proposition of Sri Lankan exports to global buyers who are increasingly demanding traceability and sustainability. “The Eravur Textile Zone is more than an initiative; it is a lifeline for the industry. “Localizing textile production is critical to increasing competitiveness and meeting the demands of global markets,” Lawrence said.

JAAF stressed the importance of continued collaboration between industry and government stakeholders. Lawrence noted that key policy measures such as improving market access, enabling infrastructure projects such as the Eravur Textile Zone, ensuring transparency and predictability in electricity pricing, and easing the operational constraints currently experienced by the Port of Colombo are crucial for long-term growth.

Meanwhile, JAAF welcomed the recent change in electricity tariffs, as Sri Lanka’s energy costs have historically been high compared to competing countries. JAAF has long advocated for the independence of the Public Utilities Commission of Sri Lanka (PUCSL) to ensure that Sri Lanka adopts a more cost-effective generation mix and that these savings are passed on to consumers through a fair, cost-reflective tariff.

Furthermore, Sri Lanka and Indonesia have jointly submitted an application to the UK’s Developing Countries Trading Scheme (DCTS) authorities for the accumulation of Indonesian textiles with Sri Lanka. If approved, this will allow Sri Lankan-made clothing using Indonesian fabrics to access the UK market.