BY EDWARD THEOPHILUS

When evaluates the export industry structure of Sri Lanka, we would find that the industry has been instigated changes in the market structure since the early 1960s with the results of foreign advice as well as findings of domestic researches. This changing trend has been continually incorporating new industries into the sector. The remarkable advice on the diversification of the export industry was logically and practically given by Prof.Dudley Seers in the late i960s, and the garment industry emerged as a vital contributor to the market structure. Garments like food are fundamental needs of humans and the associated economic activities have economic value like in the food industry.  The garment industry remained on a subsistence level that spread all over the country before the 1970s and many people engaged in making garments for employment as a way of living. The industry gained a higher commercial value and attracted a distinguishable pace in the export industry resulting in the changes in economic strategies in 1978. 

Traditionally, the aggregate export industry has been added by a higher level of contribution from the plantation industry, and with the effort of export diversification in the late 1960s, the garment industry gained a potential place of foreign exchange earnings and providing employment, especially for the female workforce through the initiation of free trade and investment zones pursuing the operation of export zones such as St. Cruse in India and the Philippines. The effective mechanization and changes in the technology of the sewing industry and abandoning of labour-intensive industrial strategy in developed countries boosted the garment industry and the changes of consumer attitudes in the modernization process that animated developing patterns and fashions to attract the young generation and accelerated private investments in the garment industry. 

The concept of exporting zones offered tax holidays and relaxation of exchange control regulation for the import of materials from overseas for the garment industry, encouraged foreign investors, and welcomed investors from developed countries to the industry after the cold war. The international experience bespeaks that many labour-intensive industrial firms moved from developed countries to developing countries on the fact that loosening international competitiveness and importing garment products to developed countries from developing countries such as Sri Lanka, Bangladesh, Taiwan, Thailand, China, and India.         

Since the economic policy changes in 1978, the garment industry has taken a prominent place in the export equation and the industry has been a crucial contributor to the employment of rural people (especially female) and foreign exchange earnings in the country for more than 40 years. Expanding tourism services further stimulated investments in the industry.  It seems that economic policymakers during the past forty years have been ignoring the productivity improvement and competitiveness in the garment industry, and politicians in the government are interested in the garment industry that has been securing vote-based promoting investments in apparel productions. However, they did not concern with the key factors such as productivity enhancement, improvement of international competitiveness, and many factors related to the apparel industry. It has been a cheerful field on employment opportunities and investment opportunities for political donors with a higher rate of return. It has been a lower cost for investors as the banking system supported than providing credits and other supports such as import and export facilities.  The other vital reflection in investment pattern was many medium and large-scale investors in fashion and store business in developed countries engaged in investment fashion products making in developing countries and the policy-makers in Sri Lanka either not understand the trend or unaware of the trend in the market. Investors exports top quality products to developed countries and medium quality to the Middle East and rejected and lower quality products to the third world.  

When analysing the management of the apparel industry in Sri Lanka it reveals that productivity enhancement and the improvement of international competitiveness are being ignored by entrepreneurs as well as government policy-makers who need concentrating on the following points.  Under the leadership of president Mr. Gotabaya Rajapaksa, the government needs to direct the industry to enhance productivity and international competitiveness.

• The major consideration should be reducing the dependency on the import of input to the industry. In this area, the import of clothing materials, sewing threads, sewing machines, garment buttons, zips, machine parts should massively reduce until they are domestically produced and ensure the quality of products. The cost of apparel production could be reduced by 30% if the import of input reduces massively improving product quality and making attractive input domestically. The production cost of input could be massively reduced by adapting Japanese style management strategy that establishes groups of companies for various purposes such as major products and subsidiaries for input production, marketing quality control, financing, and many other activities.  This is not a simple task.  If Sri Lanka has the technology, knowledge, and skills to produce many sophisticated items related to domestically producing input for the garment industry, the productivity of the industry could be massively improved. it is regret to note that depending on imports of inputs for the apparel industry is the major factor to reduce the productivity and competitiveness of the industry. The product quality of the apparel industry is entirely based on the quality of materials with attractive fabric and lower-cost production of them.
• The domestic production of yarn for producing quality and attractive materials would be key factors for enhancing productivity in the industry.  The University of Moratuwa had a division for research, development, and training related to the garment industry, and it seems that the university has failed to make innovation in this field. The university has an opportunity to gain supports from China that is a giant in the industry.
• The garment industry has failed to develop attractive and marketable patterns and fashions. The economic-policy makers need to establish a garment research institute, and need to monitor market changes in the world considering the changes in patterns and fashion worldwide, and promote innovation.  The patterns and fashion should competitively (lower cost, attractive) produce attractive products to kids, young people, females, elders, and many others.
• International promoting and marketing of products and quickly changing the patterns and fashion support to attract the market in developed countries. It seems that Bangladesh, China, and many other developing countries invaded larger supermarkets in developed countries based on major factors such as the quality of products, attractive style of consumers, and many other factors. 
• Performing industry analysis should focus on developing industry averages and comparative analysis of individual organizations within the industry. If the government strict without exceptions on this matter firms in the industry could be classified to develop, maintain, and shrink.  
• Garment factories in Sri Lanka have accountants but they don’t economic analysts with mathematics knowledge to perform industry analysis and monitor policy development, policy monitoring, and remedial management. There are many graduates from universities in the country, why they don’t use for these tasks.

The behavior of stupid people in Sri Lanka has forced to class female employees in the garment industry and the brandix corona case showed company executives too attempted to insult female employees of the company by commenting on the behavior of female employees. They were purely personal matters of employees and this situation could be changed by the earning level of employees lifting to the international level. For example, the average monthly wage for a garment factory employee increases to the US $ 300 or more, and this situation could easily be changed.

The industry management needs to identify the stages of the industry and how the value is added to the final production.  This information is vital to design a high value-adding to the economy. If policymakers developed policies to gain high value from the industry Sri Lanka could gain the annual US $ 25bilion and gain a higher rate of share in the garment export market.