Relief for local apparel sector as US trims tariffs to 20%

• Sector says move vital to retain competitiveness in its top export market
• Calls it a “critical outcome for apparel sector”
• Commends government’s negotiating team’s “pragmatic and sustained engagement” 

Sri Lanka’s apparel industry has welcomed the United States’ decision to revise the reciprocal tariff on Sri Lankan exports to 20 percent, a move the sector says is vital to retaining competitiveness in its top export market.

The Joint Apparel Association Forum (JAAF), the industry’s apex body, in a statement commended the government for its efforts in securing what it called a “critical outcome for the apparel sector”.

The revised rate follows months of negotiations after the tariff was initially set at 44 percent in April and later reduced to 30 percent. The final outcome was achieved following “pragmatic and sustained engagement” by the government’s negotiating team, the JAAF said.

“We extend our sincere gratitude to President Anura Kumara Dissanayake for his leadership and to the negotiating team led by Treasury Secretary Dr. Harshana Suriyapperuma. Their tireless efforts throughout this complex process have been instrumental in achieving a fair and competitive outcome for Sri Lankan exporters,” the statement said.

The JAAF also recognised the role played by Sri Lanka Ambassador to the United States Mahinda Samarasinghe and the Sri Lankan Embassy in Washington, D.C., for facilitating constructive dialogue with the US stakeholders.

“The revised tariff brings Sri Lanka into closer alignment with other leading apparel-exporting nations in the region—including Bangladesh, Cambodia, Vietnam, Indonesia and Pakistan—thereby ensuring a more level playing field,” the JAAF said.

Sri Lanka’s revised tariff rate of 20 percent is the same or close to that of Bangladesh (19 percent), Vietnam (19 percent), Malaysia (19 percent), Indonesia (19 percent), Thailand (19 percent) and Pakistan (19 percent) and lower than India’s rate of 25 percent.

The apparel sector, which contributes nearly half of Sri Lanka’s total merchandise exports, counts the US as its largest single-country market.

The JAAF said it remains firmly committed to working in close partnership with the government of Sri Lanka and its counterparts in the US to promote ethical labour practices, environmental sustainability and innovation in apparel manufacturing.

“We are confident that these shared values, combined with continued diplomatic engagement, will contribute to deeper bilateral trade relations and pave the way for further tariff reductions in the future,” it added.