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Fewer apparel orders than anticipated

26 Jun 2022

  • Target set at $ 6 billion
  • JAAF says target will be difficult to achieve
By Tanya Shan Amidst internal and external volatilities, export orders received by Sri Lanka’s apparel sector appear to be less than initially anticipated, according to the Joint Apparel Association Forum of Sri Lanka (JAAF). JAAF Secretary General Yohan Lawrence told The Sunday Morning Business that orders that were coming through were a little lower than they were expecting. However, discussions were being carried out on the matter among the industry stakeholders, he added. “No country has cancelled orders, but the target set for the year is $ 6 billion and achieving that is going to be difficult. External factors have also slowed down the market,” Lawrence stated.  Sri Lanka’s apparel sector has started losing around 10-20% of its orders to neighbouring competitors India and Bangladesh, as buyers express concern over the country’s economic and political situation. JAAF Deputy Chairman Felix Fernando recently said the country’s apparel sector had orders until June 2022, which had been placed by buyers or brands at the end of 2021, when the situation of the country was considered more stable economically. However, he said the buyers had proven to be reluctant to place orders for the five to six months that followed June, due to Sri Lanka’s ongoing economic and political crisis. “Buyers have started collecting information on Sri Lanka’s situation,” he said, adding that the suppliers of many major apparel brands in the country had to meet their buyers in the last few weeks to assure them that orders would be supplied without any disruption. “Even now we have lost some orders – some buyers have said that there is a high risk, so they have shifted 10-20% of their orders to India and Bangladesh,” Fernando explained. According to the Export Development Board (EDB), the apparel and textile sector has brought in $ 1.9 billion between January and April 2022, and according to Fernando, this is a 13% Year-on-Year (YoY) increase compared to 2021. Fernando noted that many economists had forecasted a global economic recession in the coming months that could reduce the buying power of apparel buyers if it were to occur – which only spells more trouble for Sri Lanka’s export sector. According to a Bloomberg Markets live survey conducted between 29 March and 1 April 2022, 48% of investors expect the US to fall into recession next year. Another 21% expect the downturn to happen in 2024, while 15% of the 525 respondents expect the recession to come as early as this year.  


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