Sri Lanka’s Joint Apparel Association Forum (JAAF) recently urged all stakeholders to put aside differences and work together to resolve the current crisis that has resulted in severe hardships for people and hampered the economy. Power and fuel outages have led to the shutdown of many small units and escalated the production cost for others, it said.
“If the current macroeconomic crisis continues for longer without taking urgent action to address it, the social and economic consequences imposed upon Sri Lanka’s people will be incalculable,” JAAF cautioned.
JAAF said that the government’s inaction in finding and implementing a constructive solution to the current crisis urgently risks the imposition of potentially heavy costs the country will continue to pay over the long-term, including access to global markets.
Sri Lanka’s Joint Apparel Association Forum (JAAF) recently urged all stakeholders to put aside differences and work together to resolve the current crisis that has resulted in severe hardships for people and hampered the economy. Power and fuel outages have led to the shutdown of many small units and escalated the production cost for others, it said.
Efforts to stifle peaceful protests have precipitated a political crisis, further complicating the situation, JAAF said.
JAAF fully supports the immediate appointment of financial and legal advisors to commence discussions with Sri Lanka’s creditors. This will allow debt servicing obligations to be paused, relieving the pressure on the system.
In parallel, Sri Lanka should urgently engage with the International Monetary Fund (IMF) to seek bridging financing for essential imports, particularly for fuel, LPG and medicines, it suggested.
Seeking the assistance of the World Bank to reallocate unutilised funds from existing projects towards emergency relief programmes can also be an immediate safety net to those most affected by the crisis, it said.
As the crisis is hurting Sri Lanka’s international reputation as a reliable sourcing destination and exporter, foreign buyers, investors and business partners are getting worried, it noted.
“It will be a steep, uphill battle to retain buyer relationships, which have been built with great effort over decades,” A JAAF spokesperson was quoted as saying by Sri Lankan media reports.
Extended power cuts and inconsistent adherence to announced power interruption schedules have disrupted production planning and manufacturing, severely affecting small and medium enterprises. The mandatory conversion of foreign exchange is complicating raw material imports, as banks are unable to meet their commitments to apparel exporters, JAAF added.
Fibre2Fashion News Desk (DS)
