100 more factories stitch for the world
The apparel industry has been given a boost following a US$1 billion government initiative to establish 100 factories together with the Joint Apparel Association Forum (JAAF).With most factories tipped to find their way to the North and East of the country, JAAF Deputy Chairman and Orit Apparels MD Channa Palansuriya told the Business Times, that one of the main aims behind this is to reverse orders going to Bangladesh.
He noted that JAAF together with the support of the Treasury would be negotiating with the Asian Development Bank (ADB) for funds for the project to be provided to selected small and medium entrepreneurs (SMEs).In this regard the apparel industry has submitted their proposals to the ADB and the Treasury with the former looking towards a technical session on the project.
The project is expected to create 25,000 jobs with factories established in locations likely to generate the required employment.
Other areas where these factories are likely to be located are Moneragala, Badulla, Bibile and possibly Hambantota, Mr. Palansuriya said.
He explained that a selection process would be carried out to find suitable former SME owners and management persons in a bid to carry out operations at these factories with the support of JAAF. The apparel forum would look at establishing the correct links between buyers and these SMEs and with some of the big players possibly even working directly with them to finance and market the products manufactured.
Revenues amounting to US$1 billion would be projected for factories run on a low cost operation. Costs to establish each factory would amount to approximately Rs.1 million, he said. Mr. Palansuriya however, dismissed recent industry comments that it was impacted due to the removal of the GSP+ concessions.
He noted that without the concessions the industry had grown but was now facing the downturn in the European economic situation.
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