End of GSP+ deal to affect apparel firm’s profit margins
July 9, 2010 06:31 am
End of duty-free access to
A Sukumaran, Chairman of the Joint Apparel Association Forum said that, the
industry was finding ways to tone down the loss of GSP+ deal, when it comes to
an end in August.
In addition, under the GSP+ trade deal, only one-third of the exports get
qualified, while the remaining two-thirds are unaffected by the loss of the
deal, continued Sukumaran.
Hence, end of GSP+ deal would not imply as a disaster for the garment industry,
although, it might affect it in some way such as the industry experiencing a
slump in the exports, thereby, lessening employment. But going by the current
dearth in workforce in the apparel industry, absorption of about 25,000 people
can also take place, informed Sukumaran.
EU countries decided to lift the GSP+ privileged trade benefits from Sri Lanka,
owing to EU Commission naming it as, ‘vital shortcoming’, on the issue of human
rights. Hence, Sukumaran said that, it is most likely that, the garment
exports, which are
With the end of the GSP+ trade deal, exporters from
However, Sri Lankan exporters are now of the thought that, while EU buyers
might agree to pay the import duty or share the same with domestic producers,
others might disagree and explore different nations for their requirements.
Although, work is underway to safeguard the thin profit margins, apparel
industry will be unable to lessen their costs by 9 percent, as the economic
nitty-gritty is functioning against them.
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