Daily News Blog

Sri Lanka apparel sector to gain from new US tariffs

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ith the US imposing new tariffs on a number of different countries it would have a beneficial impact on states like Sri Lanka as buyers are now re-looking at their global supply chains and shifting orders.

MAS Holdings CEO Suren Fernando speaking with The Sunday Times Business on Monday said that they are currently receiving inquiries from buyers to the US who are now re-looking at their global supply chains and are hoping to make a partial shift of their orders to countries like Sri Lanka.

Mr.Suren Fernando

The US increasing tariffs on countries like Mexico, China and Canada will mean that the US consumer will have to pay more and brands from these countries will become more expensive and as a result buyers are likely to shift elsewhere to purchase goods.

Mr. Fernando explained that there is likely to be a lot of trade volatility as a result of these new decisions and Sri Lanka should ideally benefit.

MAS already has design and logistics facilities in the US to enable them to serve the customer better through proximity. However, they noted that they currently have no plans for further expansion there.

He noted that though Sri Lanka will not be able to match the large quantities produced by Bangladesh and Vietnam however they need to work on their “value premium” that ensures Sri Lanka is ahead of the others and shows the clear difference.

MAS is not focusing on topline growth but more on resilience to make the business stronger and financially staying ahead, it was noted.

Mr. Fernando pointed out that Sri Lanka has the capability to make more intricate leisure, lingerie, sportswear and swimwear using higher valued fabrics.

The MAS CEO said that the country’s target of achieving a US$5-8 billion revenue within the next three years will bring about a significant improvement within the industry.

“We offer faster lead times, and have made technological advances within the industry as well,” he said. Sri Lanka currently ships directly to the US from Sri Lanka.

Mr. Fernando observed that when changes were announced at the end of last year by the US authorities that merchandise coming to Mexico shipped duty free to US will be impacted, suppliers in countries like Sri Lanka believed this could spell a trade barrier coming into play.

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