The garment industry says it is already using the government’s Export Reward Scheme to get manufacturing orders. Factories are using the 5% export rebate offer by the government, to reduce their selling prices and get an edge over competition.
“This year there is huge pressure on factories to lower their selling prices to international buyers. Buyers want lower prices than last year. So factories have been using the government’s 5% export rebate to subsidise their selling prices and get orders. We will have to continue doing this throughout the year,” said the Chairman of the Joint Apparel Association Forum (JAAF) Ajith Dias.
Already some factories are trying to use the rebate to secure orders during the off-season in the second half of the year. “We are hoping to use the export rebate and the GSP+ to keep going through the off-season from July to August. So far the government package has helped factories to get enough orders, to avoid worker lay-offs and factories are trying to get orders for the second half of this year as well,” said Mr Dias.
During the first two months of this year, garment exports that nose-dived in December showed signs of recovery.
In December 2008 garment exports reduced by 5.3% compared to December 2007 with both major export markets for Sri Lankan garments contracting. Exports to the US dropped by 10.0% and exports to EU also dipped by 4.2%. |
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