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 Post subject: Sri Lanka Targets $4.5 Billion Revenue In 2007 From Garments
 Post Posted: Wed Apr 27, 2005 3:08 am 
Sri Lanka Targets $4.5 Billion Revenue In 2007 From Garment Exports

04-26-05 04:25 AM EST

COLOMBO -(Dow Jones)- Sri Lanka is targeting revenue of $4.5 billion in 2007 from garment exports, helped by a long-term strategy that will offset the effects of the expiry of a preferential trade agreement with the U.S., an industry official said Tuesday.

"Eighty-five percent of our products came under the quota and the industry has now become very competitive," Tuli Cooray told a seminar.

Cooray heads a committee of private sector representatives and government officials responsible for mapping out and implementing a long-term survival plan for the garments industry after the Multi-Fiber Agreement with the U.S. ended Jan. 1.

Under that agreement, which came into effect in 1974, the U.S. has been obliged to buy a set quota of garments and textiles from Sri Lanka and several other emerging-market countries.

Cooray said most U.S. buyers have switched to cheaper garment manufacturers like China, Mexico and other South Asian nations.

China's current market share in the U.S. is around 55%, compared with Sri Lanka's 2%, he said.

Still, Cooray believes the island's garment exports will pick up over the medium to long term.

Under the five-year strategy, Sri Lankan garment manufacturers are looking to "penetrate premium market segments and become internationally recognized in specific product categories," he said.

Sri Lanka already enjoys a niche market for intimate apparel with retailers such as Victoria's Secret, Learner, Express, Marks & Spencer and BHS among its key customers.

Cooray said the industry hopes to increase the manufacture of specialty products over the next few years to 20% of total output from 10% currently. He said products aimed for discount stores will between 10% and 30% of total output, down from the current 40%.

Sri Lanka's revenue from garment and textile exports climbed 9% to $2.8 billion in 2004. Industry officials say revenue could fall this year as the island adjusts to the new trading policy.

The U.S. is the largest buyer of garments and textiles from Sri Lanka, accounting for more than 60% of the country's total garment exports. Textiles and garments are Sri Lanka's largest export earners and make up 50% of its total export earnings.

-By Zaithoon Bin Ahamed, Dow Jones Newswires; 941-2304 940; zaithoon.ahamed@ dowjones.com

-Edited by Mary de Wet


Dow Jones Newswires
04-26-05 0425ET
Copyright (C) 2005 Dow Jones & Company, Inc.


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