The socio economic environment of Sri Lanka experienced a revolutionary change in the past two decades. The traditional export system, on which our economy was based over the years with its main exports being tea, coconut and rubber, experienced changes with new substitutes. The apparel industry now taking the place of Sri Lanka's main export income earner could be attributed to various changes that have taken place. Thereby the apparel industry constitutes 53% of the total export income coming into Sri Lanka. According to the Central Bank reports the total annual income earned, ranges between USD 2500-3000 million. It has now become necessary to maintain this income avenue and develop it further. Therefore taking the new global and local situations into consideration, pursuit of the new openings in the apparel sector is now taking place.
In the latter half of the 1980s and early half of the 1990s the late President Ranasinghe Premadasa created a sort of a renaissance in the rural sector which centered on the apparel manufacturing industry. Focusing specially on the unemployed rural youth the apparel industry was moved into rural areas. The effort was not only successful but was also the reason for the progress and sustainability of the industry.
There are around 200 large scale garment factories that were been taken to the rural areas during the era of Ranasinghe Premadasa. This number was increased by a further 50 by the present President during the previous government.
It was indeed a worthy endeavour made by all past governments to take the apparel industry of Sri Lanka as a positive aspect in a socio economic programme. As a means of finding proper solutions to the ever increasing unemployment problem in the difficult and most difficult areas, the present government too is giving all possible assistance and encouragement for continuous generation of jobs through the apparel industry. Whilst 65 garment factories have been established in difficult areas, the garment quota allocated is 50,000 dozens.
There are 60 garment factories in the difficult areas with an allocated quota of 25,000 per industry. The allocated quota for the garment factories established in urban and semi-urban areas is 12,500 dozens per factory.
The decision taken by the government to allocate an additional quota of 25,000 dozens to factories in the most difficult areas where the unemployment problem is acute, is aimed at several purposes. Creating job opportunities as a solution to the serious unemployment problem existing in the most difficult areas, to rejuvenate some of the factories in the difficult areas that have not been doing well thereby developing the economic and social benefits achieved, are some of the prime objectives. Another important factor is to create a foundation, stable enough maintain the supply of jobs by the garment industries in the particular areas, even after the lapse of the quota system.
The first step of this process is to encourage the creation of a further 250 jobs in one factory. Having called for applications in this regard, 18 factories in the "most difficult" areas such as Medawachchiya, Mihintale, Ambalantota, Weerawila, Bibile, Elahera, Kebithigollawa, Hatton, Hanguranketha, Thumpane, Hambantota, Kantale have qualified to come under this category.
All these factories agreed to accept as a pre-condition the recruitment of the exact and total number of employees, in keeping with the current quota allocation of a garment factory. The new quota allocations will be made subsequent to the recruitment of a further 250 employees, fulfilling the above requirement as a pre-condition. Accordingly the minimum number of employees in a factory in the difficult areas will increase to 750.
The time frame agreed to for providing new jobs in the apparel sector is the period ending October 15, 2003. The minimum number of jobs that could be generated is estimated to be 7500.
Providing employment in the areas identified as most difficult will be on the other hand definite relief to the flood/drought victims who had undergone severe dilemmas in the recent past.
The next step in the apparel industry related job programme targets to provide 3000 jobs to the youth in the so-called "difficult " areas. The basic condition stipulated for most difficult areas is applicable here too; i.e. to recruit the exact number of employees in line with the current quota allocation and the recruitment of the stipulated numbers with the new quota allocations.
There were weaknesses in some of the operational sections of the garment industry projects established in the past, probably due to an increased rate of expansion. Whilst these drawbacks had adverse effects on the employees, some problems aggravated to the extent of a closure of factories. The main problem lies especially in the area of facilities of the employees. The government having fully analysed this situation is now involved in bringing the working conditions of factories to acceptable standards. This includes a minimum of two meals, transport facilities and many welfare programmes including other facilities.
Being operative in Sri Lanka over a decade, the apparel industry has positioned itself as an experienced and profitable industry. Although for some reasons some of the factories have fallen, what we are left with are a sound group of factories that have overcome all difficult situations. These factories which are of quality, are now able to constructively contribute towards maintaining a steady growth rate and creating new job opportunities based on their experiences and the new quota allocations made by the government.
Another condition agreed upon between the government and the garment factories is to provide a complete training to all employees who are now in the unskilled categories. This training would in the long run be useful for the employee to engage in self-employment projects.
Although employees of garment factories in the FTZ and outside, have contributed immensely towards the steady export growth in the past, their social image has been at a very low level. However the government is now mediating in certifying a new garment factory service proposal whilst maintaining proper security and working conditions for employees. In today's society, the fact that involvement in the apparel industry could be beneficial to the economy of the worker, especially the potential to earn foreign exchange, has not been adequately appreciated.
The focal point in the apparel exports which in Sri Lanka's economy takes first place in bringing in foreign exchange, is the worker. The dedication of the worker is a social duty. The ministry is now implementing a programme to assess the importance of the worker and evaluate his/her service. The necessary funds have been allocated for this exercise which would commence in mid September.
The high percentage in the export income alone proves the level of the enormous task carried out by the apparel industry in the past one and half decades in the execution of social growth. This sector has contributed immeasurably in uplifting the standards of our youth by saving them from various, possible catastrophes.
As already known, the quota system will lapse after the year 2005. The government is fully aware of its responsibility in taking precautions against a situation of a sudden loss of employment. In this regard the apparel export associations with the facilitation of the Ministry of Enterprise Development, Industrial Policy and Investment Promotion have prepared a five year plan to neutralise the foreseen negative situation.
The government is working towards a Free Trade Agreement with the USA which would enable the 17.5% duty, which has a negative impact on our apparel exports, to be waived.
By obtaining the benefits that have been afforded to Vietnam, Bangladesh, certain Caribbean Islands and countries surround the Sahara Desert Sri Lanka apparels would enter the American market, more competitive.
Going beyond apparel manufacture by manufacturing the textile required for the manufacture of finished garments and attempting the manufacture of the accessories and related items within the country, thereby increasing job opportunities, are also some of the areas that would be included.
The University of Moratuwa has already commenced a diploma programme in collaboration with the London School of Designs affiliated to the London Institute which is top most designs institute in the world.
Various bottlenecks such as delays in the port, port charges etc., which hamper the progress of the apparel industry, have been effectively dealt with. This helps speed up and reduce costs.
The government has recognised the need to place the apparel industry in a new progressive chapter in order to maintain sustainability of the significant progress taking place in the development due to the competent construction of new economic policies. Accordingly it has been planned to create 10,000 new job opportunities by allocating quotas to this industry within the existing limits and having them well monitored. A steady journey in Sri Lanka's industrialisation could be certified through a more systematic organisation and by facing the forthcoming challenges. The objective of the programme is to address the issues of unemployment and upliftment of the rural economy through the advancement of the apparel sector.
Source: Daily News, SriLanka
August 25, 2003