Lankans seek to dress the Chinese

The Sunday Times - 09/02/2014
By Sunimalee Dias

Sri Lanka’s apparel industry is looking towards China this year aimed at finding new brands and increasing chances of promoting garment exports via a new gateway with trade concessions for its existing buyers to the East Asian partner.

But reasons for the shift in market focus would also be due to the fact that industries need to align themselves with wherever the free trade agreements (FTA) are entered into by the government, Sri Lanka Apparel Exporters Association Chairman Yohan Lawrnce told the Business Times.

The Chinese market is said to have grown in addition to a good demand for luxury goods due to the large spending capacity by its locals. As a result of the rising income levels this new emerging market was today becoming a brand and quality conscious market.

In this respect, Mr. Lawrence pointed out that apparel manufacturers in Colombo could look for tie-ups with brands in China, promote existing brands and work with Sri Lankan businesses to market goods from Colombo using the tariff free concessions once the FTA was implemented.

However, in terms of clothing it was found that the clothes designed for the European market would be able to still expand its reach with similar clothing patterns without looking for a customised solution.

MAS Holdings Director Ajay Amalean told the Business Times he believes that since the global situation being quite unpredictable was why everyone was looking for new markets.

Commenting on whether they would go in for tie-ups with new brands from China, he said they would opt for both.

It was pointed out that the Chinese home grown brands needed to be identified first before venturing in for tie-ups. He noted that they had not carried out studies into this market yet.

On the other hand, Mr. Amalean was more positive in trying to use the FTA should it prove gainful for their existing brands.

The Export Development Board (EDB) would co-ordinate the relevant work for the apparel sector and it was pointed out that business to business meetings with trading associations was being worked out.

The government has been pursuing increased trade concessions with China and it was reportedly stated that this would be the strongest if achieved in their 60 year bilateral relations history.

Sri Lanka's footwear and leather industry booming

The Colombo Page - 08/02/2014

Sri Lanka's footwear and leather sector has shown a remarkable growth in the last year with exports surging over 63 percent from the previous year.

The total Leather and Leather Product exports stood at US$ 51 million in 2013 increasing 63.5% from the US$ 31.19 million earned in the previous year.

"Our footwear and leather exports have shown a strong growth trend," Minister of Industry and Commerce Rishad Bathiyutheen said Friday addressing the inauguration of the sixth edition of the Footwear and Leather Fair at the BMICH.

The 2014 exhibition held from February 7-9 is organized by Sri Lanka Export Development Board in collaboration with the Ministry of Industry and Commerce, Industrial Development Board and Footwear and the Leather Products Manufacturers Association.

Minister Bathiyutheen said the event is a strong platform for networking and market diversification for Lankan stakeholders.

"What is more interesting is that this event is also taking place at a time when our footwear and leather exports are showing a strong growth trend," the Minister said.

Foreign buyers from Egypt, Korea, Kenya, Seychelles, France, Germany, India, and a delegation from Iran are participating in this year's event. Also, 19 Indian exhibitors from the Indian Footwear Component Manufactures Association (IFCOMA) are showcasing their products at the exhibition.

Speaking at the inauguration ceremony, Sri Lanka Export Development Board Chairman and CEO Bandula Egodage said the industry makes a significant contribution to the Sri Lankan economy in two ways.

"The industry depends 50 percent on its imports and 50 percent local manufacturing, which means the industry is saving for foreign currency as well as earning for foreign currency," Egodage explained.

The three-day exposition which concludes Sunday includes an exclusive fashion show, a design competition, a best stall competition and an award ceremony. The fashion show will be held Saturday and the award ceremony will be held on Sunday.

“Lanka capable of producing 15 million pairs annually”-EDB

Asian Tribune - 01/02/2014

In this flashback photo at the fifth International Footwear & Leather Fair 2013, Colombo, HE the President Mahinda Rajapaksa inspects a leather product with Rishad Bathiudeen (Minister of Industry & Commerce) on 10 February 2013.

The Sri Lankan footwear and leather industry is growing at a steady pace-and has developed into a sector catering to international markets. “Forthcoming 6th International Footwear & Leather Fair is a three day event and will move our producers, who now show 45% value addition, to international buyers” said Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka on 31 January in Colombo.

Minister Bathiudeen was acknowledging his officials’ info on the forthcoming 6th International Footwear & Leather Fair which will commence in Colombo on 07 February. The three day exposition will pack such events as, a Designer Award Ceremony, an exclusive Fashion Show and a stall competition. On display are footwear, raw material, travel goods, chemicals, leather goods, components & accessories as well as machinery. In addition to the general public, Importers, Buying houses, Traders, Designers, Wholesalers & Agents, Brand owners, and Industrialists are expected to grace the expo.
According to the EDB, Sri Lanka is capable of producing up to 15 million pairs annually, excluding rubber thongs which alone is estimated to total between 27 and 30 million pairs annually. The footwear industry at present employs about 20,000 people directly and indirectly includes 10 large export companies, 30 medium scale companies and about 3000 small scale manufacturers. Footwear sector which showed a growth in the past 4 years (2004 – 2007), was badly reflected by global recession in the years of 2008 and 2009. The value of exports of footwear and leather & leather products accounts for US$. 12.24 million and US$. 18.95 million respectively in the year 2012 and US$. 29.27 million and US$ 21.61 million in 2013 shows an increase of exports of footwear and leather products compared to the corresponding year of 2012. It is important to mention that footwear sector was able to obtain a significant growth of 139.13% in the year 2013.

According to the EDB, the footwear industry has significant potential to be a key contributor to Sri Lanka’s economy, and already provides high end products to Mark & Spencer, Bata France, H.H. Browns, Clarks, Aerosoles and Nike. A diverse range of shoes including canvas and rubber boots, thongs, sports shoes and leather shoes are produced, using a variety of raw materials. From colourful rubber thongs to genuine leather shoes, Sri Lanka footwear industry has already established as quality conscious and fashionable supplier to well known international brands.

The EDB added: “In just a short space of time the shoe industry in Sri Lanka has adapted itself to the requirements of the world market. Today it is equipped to tackle both functional and fashion requirements of the modern and ever changing market place. The country produces an extremely diverse range of modern shoes in a multitude of materials and finishes. The bulk of the production in the canvas range consists of up market fashion shoes both in cold processed and vulcanized construction. Shoes are produced for well known brand names such as Esprit, Benetton. The rubber boot range consists of children’s boots in attractive colours and designs, yachting boots, fishing boots, bean boots and boots for a variety of functional purposes including military. A large volume of rubber flip flops (thongs) are produced both for local and export markets. In recent times the leather shoe sector has emerged as one with good prospects.

“Today, leather shoes accounts for a significant proportion of the footwear exported from Sri Lanka. A variety of dress shoes, boots and casual shoes in stitched down and cemented construction are available for all genders. Sri Lanka is slowly but surely carving out a niche for herself in the world market for leather footwear. Apart from manufacturing processed leather, the leather products industry includes the manufactures of goods such as gloves, wallets, bags, purses, etc. There are approximately 5 large companies, 10 medium scale companies and around 1000 small enterprises. Eleven tanneries in the country produce 25 tons of leather every day, and most of the large companies have their own tanneries.

“Leather product manufacturers also cater to famous international brands like Play Boy, Laurel, Helen Kaminiski, etc. One of the key advantages enjoyed by the footwear industry is the locally available high quality natural resources including rubber and sole crepe. Sri Lanka is the only country which produces and exports sole crepe with value addition. Encouraged by the push for “green” products worldwide, there is a great demand from international markets for unit soles manufactured from Sri Lankan sole crepe.Major export markets for Sri Lanka footwear industry are Italy, UK and France and other European Union countries.

The industry continues to consolidate these existing markets while looking to enter emerging markets. Reliable quality, sustainable volumes and competitive pricing of our footwear have been key factors contributing to the success of the footwear industry in Sri Lanka. Thus, the Footwear & Leather Fair 2014 will strengthen and sustain the image of the Industry and promote Sri Lanka export capabilities among international buyers and provide opportunity for SME’s to advance their talents and capabilities to become industry experts in the export field.”

Footwear & Leather Fair from 7 to 9 February at BMICH

Daily Mirror - 30/01/2014

The Sri Lanka Export Development Board (EDB) together with the Ministry of Industry & Commerce, Industrial Development Board and the Sri Lanka Footwear and Leather Products Manufacturers Association (SLFLPMA) will provide a platform for Sri Lankan footwear and leather product exporters, manufacturers and SMEs’ to showcase their talents and capabilities locally and globally by organising the 6th Footwear and leather Fair 2014 from 7 to 9 February 2014.

Footwear and Leather industry contributes a considerable share to the country’s exports earning and shown a remarkable growth during this year. In addition, footwear manufacturers cater to more than 50% of the local market requirement, minimising imports of such items.

It is said that 150 operations are necessary to produce a pair of shoes. The growth of this labour intensive industry will widen the employment opportunities for youth in the country too.
The internationally acclaimed recognition of the Sri Lanka apparel industry, highly skilled and trainable work force, and the availability and easy access to natural leather in south India are considered favourable factors for the growth of the industry.

The Footwear & Leather Fair initiated by the EDB in the year 2007 with the objective of creating and enhancing the image of the industry locally and globally. In addition to showcase the country’s entire footwear and leather products range under one roof; the exhibition provides an opportunity for up and coming designers to showcase their talents by participating at the design competition.
The growing enthusiasm of participants to participate in this competition helped to add innovative and novelty items to the Sri Lankan Footwear and Leather products basket.

This years’ fair will have more than 220 stalls exhibiting a wide range of footwear, leather products, travel goods, raw materials, machinery, components and accessories. The award ceremony of the design competition will also be held as a special event of the fair on 9 February at 4 p.m. and a fashion show organised parallel to the fair will be held on 8 February at 7 p.m. at the fair venue.

The fair provides a good opportunity for the young generation to learn and observe the progress made by this sector and to consider them to join as employees or entrepreneurs in the future. In addition, the fair allows public to purchase export quality footwear and leather products at a reasonable price too.

Apparel exports top US$ 4.3 bn in 2013

Daily News - 31/01/2014
By Diresh Jayasuriya

Apparel exports in 2013 have reached an all time record of US$ 4.3 billion compared with US$ 3.8 billion in 2012," said Joint Apparel Association Forum (JAAF) acting Chairman Noel Priyatilleke.

Speaking at the JAFF 10th Annual General Meeting he said that nevertheless, the challenge ahead of us is not only to sustain this business but also to grow because the Government expects Sri Lankan apparel, tea and rubber to fetch a turnover of US$ 10 billion by 2016 and Sri Lankan apparel has also to be among the first ten apparel exporter countriesof the world by 2020.

The time has come for us to explore all possible avenues to reach this target and I do believe that Sri Lankan apparel can achieve it, because of the visionary leadership given by the stalwarts of our industry coupled with the business friendly environment created by our Government. Let us get together to perform this task.

"The introduction of Gazette Notification which directed that all Shipping Service Providers shall ensure that a Bill of Lading clearly indicates whether the consignment is freight collect or freight pre-paid on a request made by us was a great achievement.

"This could not be achieved for more than a decade and a half".

"Sri Lankan entities can now place orders in other low cost bases in the region, bring back to Sri Lanka, add value and export. Multi country consolidation which is offering enormous opportunities is also now possible." "We have continuously included the subject of market diversification and made representations to the Government to explore the possibilities of obtaining preferential treatment from China, India, Japan, Russia and Brazil.

The proposed FTA with China would help the industry in a great way."

"If not for the introduction of the suspended VAT scheme the complexities attributed to VAT administration system including refund mechanism and double digit rate, the apparel industry could not have been able to perform.

"I believe a transparent single digit VAT system is an absolute necessity for the economy to grow."

"JAAF believes that the completed reform agenda supported by the international market penetration activities, in particular conclusion of China Free Trade Agreement and other targeted non traditional markets, Sri Lanka will rank as the best among sourcing countries in this part of the world."

"We are confident that with all these reforms and trade facilitation measures, we should be able to reach the target of US$ 6 billion in 2020."

Dr. P. B. Jayasundara, Secretary to the Treasury, Ministry of Finance and Planning and Economic Development was the chief guest at the event. 

Cinnamon To The World

' Cinnamon To The World' event streaming live on "www.cinnamontotheworld.com/events.php" at 3.00 p.m. Sri Lankan Time

Biz delegation from Hong Kong to visit SL in April

Lanka Business Today - 25/01/2014

In a new breakthrough after a year from the first ever successful Hong Kong-Sri Lanka biz MoU in 2013, some Hong Kong based manufacturers are now looking to move factories to Sri Lanka and a high powered biz delegation from HK is now scheduled to arrive in early April.

”The first ever business development MoU between Hong Kong Trade Development Council (HKTDC) and the Export Development Board (EDB) was a tremendous success and some Hong Kong based manufacturers are looking to move factories to Sri Lanka. A delegation led by none other than the Deputy Executive Director of HKTDC Ms Margaret Fong is scheduled to arrive in early April for the next level in this process. Some HK manufacturers have already expressed interest to set up production in Sri Lanka, especially in garment and food, as well as handicraft and sunshine industries. Tentatively, there will be 20 delegates from 15 companies in the forthcoming delegation. We are also helping some Sri Lankan exporters to find HK markets and importers,” said Sunny Chau, Regional Manager, HKTDC Southeast Asia and India, on January 21 in Colombo.

Chau, on a three-day visit to Colombo, was leading a three-member delegation for preparation-cum-awareness sessions for interested Sri Lankan business on the forthcoming early April B2B sessions between Hong Kong’s HKTDC delegation and Sri Lankan businesses.

April’s delegation leader, HKTDC’s Ms Margaret Fong, has wide experience in international trade. She served as the Deputy Director-General in the Washington DC Economic & Trade Office of the Hong Kong Government.

Total bilateral trade between China and Sri Lanka in 2012 stood at US$ 2,676 million of which US$ 2,568 million consisted of imports to Sri Lanka. FDIs (Private investment inflows, equity, profit and inter-corporates excluding mega project funding and loans for them) from China to Sri Lanka in 2012 totalled US$ 185 million. Hong Kong is ‘the most globalized economy’ in terms of trade, according to Earnst & Young. HK is also the gateway to the complex Chinese marketplace.