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HomeBiz NewsSLAEA Chairman Urges Cashless System Amidst SVAT Abolition Highlights industry’s willingness...

SLAEA Chairman Urges Cashless System Amidst SVAT Abolition Highlights industry’s willingness to collaborate….

Re-elected Chairman of the Sri Lanka Apparel Exporters Association (SLAEA) Indika Liyanahewage has emphasized the significant challenge posed by the proposed abolition of SVAT. He urged the government to introduce an alternative cashless scheme, highlighting the need for a secure and modern financial framework for the industry. Speaking at the 41st Annual General Meeting of the SLAEA at which the entirety of the Executive Committee was also re-elected until 2024, he added that a cash-based system could potentially lead to corruption and malpractices.

“The apparel industry stands ready to collaborate with the government in the implementation of a new cashless system,” he stressed.  “Whilst appreciating the decision to delay the removal of SVAT to 2025,” the Chairman noted that a robust and transparent mechanism for a cashless refund system was vital. He added that,  “a corruption-free financial environment is crucial for the industry’s sustained growth and ethical business practices.”

Meanwhile, addressing the current state of the industry, Liyanahewage asked the Government to enter into strategic partnerships with Japan and India amid a decline in orders faced in Sri Lanka’s primary markets of the USA, the EU and the UK , which account for over 85% of Sri Lanka’s apparel exports.

“Japan, in particular, presents a significant opportunity, with an annual import of USD 26 billion worth of apparel, of which only USD 35 million comes from Sri Lanka. There is great potential for growth in the Japanese market.”

Regarding exports to India, Liyanahewage noted that under the existing ISFTA, Sri Lanka’s apparel quota to India is currently set at 8 million pieces per year. Sri Lanka imports raw materials from India to the value of  USD 1 billion, yet only exports USD 50 million of textile and apparel to India. The industry is hopeful the limit could be lifted allowing for increased trade and collaboration between the two countries.

Chief Guest at the AGM Minister/Deputy Head of Mission of the Embassy of Japan Katsuki Kotaro commended Sri Lanka’s apparel sector for its resilience amidst the economic crisis, despite the drop in orders.

“Sri Lanka should look into expanding its markets. While I fully agree that GSP+ will not be here forever, in the mid-to long-term, the country must ensure strengthening market access. And for that, free trade agreements are the best way,” he stressed. He recognized Sri Lanka’s intimation that the country would apply to join RCEP which would pave the way for better access to the Japanese market.

The Sri Lankan Apparel Exporters Association is the leading association representing the country’s apparel exporters with a membership encompassing over 70% of the nation’s apparel exports.

The Association is an active member of various statutory and non-statutory boards, chambers and associations, playing a crucial role in shaping and implementing government policy decisions that support the continuous growth of the industry.

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