'High production cost, most challenging' – Mr Channa, CEO, Orit Apparels

25 Feb '09

2 min read

The CEO of Orit Apparels, the Rs 4 billion company headed by Mr Channa Palansuriya, was very candid when he said that, “The greatest dilemma facing the clothing industry in present times was the high manufacturing costs”. He said this at the annual general meeting of Apparel Exporter's Association held last week.

He added by saying, “Above from the above, the sector was also faced with the challenges of a slowdown in the US and EU economies, along with the issue of renewal of GSP benefits by the EU, but the sector was performing well with growth generated from the EU, while a nominal decline was noticed from the US”.

Divulging statistics, he said, “Total apparel exports showed a growth of 3.5 percent growth in 2008, despite a fall of 5.3 percent in December, when compared with the corresponding periods of the previous year and though shipments to the US recorded a marginal decline of 5.5 percent, those to the EU registered a boost of 10.7 percent”.

He advised the government to devalue the local currency by 15 percent and announce stimulus packages to reduce the negative growth rate in exports from the sector, but added by saying that it cannot be done with current situation of the Sri Lankan economy. He saw a pall of gloom over the sector since 50 percent of exports are destined for the US.

Commenting on the weaknesses of the industry he said, it was afflicted by low productivity, higher dependence on imports of fabrics, lack of designing capabilities and a very high concentration on the markets of the U and the US. He urged the exporters to diversify their markets in order to beat the slowdown in these key markets.

He was also highly appreciative of the government when he said; the government has to be appreciated for its policies like providing a liberal business environment, educated and trainable labour, quality supplies, logistics, and speedy turn around time as well as adhering to compliances, to enable the sector stand apart from its competitors.

Fibre2fashion News Desk - India