High Note

August 23, 2006 (LBO) – Sri Lankan apparel exports to Europe grew by as much as 30 percent in June, as manufacturers made better use of tax breaks to the EU. The industry earned 1.32 billion dollars in the first half of this year, a four percent growth, though exports to top market the United States dropped marginally.

Exports to the European Union in June spiked 29.8 percent to 104.9 million dollars, while exports to EU in the first half were up 9.4 percent on last year to 516.2 million dollars.

Sri Lankan clothes sold in Europe also saw a 31 percent jump in value up to end May this year to 406.1 million Euros.

The growth to Europe, despite a drop in exports to that region last year, could be due to better utilization of tax breaks under the Generalized System of Preferences Plus (GSP+) scheme, top officials with Sri Lanka™s Joint Apparel Association Forum, told LBO.

The sudden increase in exports could also be due to transshipment volumes.

Sri Lanka is allowed to export goods like clothes duty free to Europe under the GSP+ scheme for its strong labour standards, on condition it has up to 50 percent local value addition.

Exports to the