2005
was a turning point in the garment industry and Sri Lanka’s
economy. The Sri Lankan apparel industry has benefited significantly
from the Multi Fibre Agreement (MFA). It guaranteed an export
market despite severe competition from more efficient producers.
Its removal enables buyers to procure requirements from
the most efficient producers thus posing a threat to those
manufacturers competing solely on price. This scenario also
poses an opportunity to manufacturers, who have been competing
on quality, supplying garments to the higher end of the
market to enhance their export volumes. With the loss of
protection hitherto provided by the MFA, the small manufacturers
will lose market share to more efficient manufacturers,
thereby leading to an inevitable consolidation of the global
apparel industry.
Even though we live in
a competitive global trade environment, SMEs from developing
countries like Sri Lanka still find it difficult to expand
trading activities beyond their boundaries.
The project to improve
the competitiveness of the SMEs engaged in the apparel manufacturing
industry, will be implemented by the European Chamber of
Commerce of Sri Lanka, in conjunction with the Joint Apparel
Association Forum (JAAF). The project hopes to provide practical
and technical advice to the participants and will be specific
to their own prevailing needs. The development of the strategies
contained in this project can be effectively used by the
sector to conduct business with potential partners in the
EU, and to bring about further value-addition to their products.
Incidentally, the SME apparel project will cover many of
the elements on productivity improvement and increased competitiveness
as described in the 5 Year Strategic Plan, published by
JAAF, thus directly filling the need required by the sector
for improved business practices and improved productivity
that can lead to increased competitiveness.
The apparel industry can
now be classed as truly global. It is important that the
industry recognizes the importance of competing within such
an environment. The direct beneficiaries have the opportunity
to benefit from the project through an improvement in their
working methods and processes, resulting in cost reduction,
improved productivity and lead times.
The project is co-funded
by the European Union and comes under its Asia-Invest programme.
The Asia-Invest Programme was launched in 1997 as an initiative
of the European Union to promote and support business co-operation
between the EU Member States and Asia.
I am certain the project
will give a significant boost to the participating companies,
thereby increasing business links between Sri Lanka and
the EU.
Koenraad Pringiers
President
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