Duty free access to EU was granted to Sri Lanka during the ratification of 27 International Conventions. This advantage will come to a culmination with expiry on December 31, 2008 and reapplication for the same needs to be done by October this year.
The situation is most likely to get grim since investors in the country would surely move out if concessions to Sri Lanka are denied. Domestic manufacturers are scouting for new locations that offers conducive and affordable production atmosphere.
In an exclusive interview with Fibre2fashion, Mr Kumar Mirchandani, Chairman Marketing Committee, Joint Apparel Association Forum (JAAF), stated, “When deciding on renewal, EU will do a technical review of Sri Lanka's progress over the last 3 years in relation to the conventions that were signed earlier. GSP+ is crucial to our industries and employment, especially for our garment industry. So we are urging the EU Government to consider Sri Lanka's high labor, health and safety standards in our factories as a positive argument for renewal of the GSP+.”
Mr Mirchandani further added that the country had taken a lead in ‘Green’ apparel factories, two of which were inaugurated recently by Mr Stuart Rose, CEO of Marks and Spencer.
Countries like Vietnam and Cambodia are struggling to capture the international market giving tough competition to Sri Lanka. However, what needs to be brought under the consideration of EU is that despite high cost of labor, exorbitant cost of power and advancing inflation, Sri Lanka has managed to sustain the cost of production.
Mr Kumar was very earnest when he said that complying with best practices does not come cheap, and therefore the GSP+ access is very important to the country to maintain the industry’s position in an extremely competitive landscape that does not always reward and reimburse the cost of compliance to higher standards.
Nonetheless, Mr Mirchandani is optimistic about receiving the concessions and suggests that the country should adjust and do whatever is needed to secure GSP+ for the years to come.
