New opportunities and a new chapter in UK–Sri Lanka trade

FROM 1 January 2026, the UK implemented reforms to its trade preference scheme, the Developing Countries Trading Scheme (DCTS). Sri Lanka’s garment sector is the most significant beneficiary of these reforms.

Recently, with Industry and Entrepreneurial Development Deputy Minister Chaturanga Abeysinghe, I went to see some of the first garments leaving for the UK, tariff free, from the warehousing facility of local logistic partners at Maersk and Speedmark. 

Garments are Sri Lanka’s largest export to the UK, and I hope volumes will grow. I know from talking to NEXT, Tesco, and Marks & Spencers (M&S) that they are looking at what this new opportunity could mean for their sourcing approach. 

The garments link with the UK goes back a long way, with companies like M&S early players when the industry was born in Sri Lanka. 

The DCTS, including the latest reforms, are simple in its promise – easier, broader, and more predictable access to the UK market for developing partner countries. For Sri Lankan apparel manufacturers and the logistics ecosystem that supports them, the zero‑tariff benefits under DCTS can be transformative. They reduce costs, improve price competitiveness, and reward quality and reliability. There are all areas where Sri Lankan suppliers have earned a strong reputation over many years.

What DCTS means for UK apparel brands

Across my meetings, I heard a clear message from UK brands. Sri Lanka is a trusted sourcing destination with the capability to do more. Buyers value the country’s technical strength and on‑time delivery. That appetite reflects careful assessments of risk, quality, and capacity. Sri Lanka’s suppliers are meeting those tests and are preparing to scale.

The practical value of zero-tariffs on apparel is lower landed costs, stronger competitiveness, and supports sourcing that moves up the value chain from basics to now include performance and premium categories. They emphasised predictability through clearer rules of origin and smoother border processes. These help commercial teams plan longer commitments and maintain price stability for UK consumers, while supporting supplier investments in skills and compliance.

M&S, NEXT, and Tesco – longstanding partners of Sri Lankan manufacturers – pointed to the country’s cutting‑edge R&D and design collaborations, areas where Sri Lankan suppliers work closely with UK technical teams on fit, fabric innovation, and sustainability features. 

Logistics: Sri Lanka’s quiet competitive edge

Strong manufacturing needs strong logistics. I saw Speedmark’s multi‑country consolidation operations that bring together NEXT products from Sri Lanka and the wider region before departure to the UK. This model reduces handling, shortens lead times, and improves schedule certainty – exactly what modern retail supply chains require. At Maersk’s Sri Lanka operations, teams manage country consolidation for major UK customers, ensuring efficient flows from factory to port and onwards through global networks. 

These capabilities are anchored by Sri Lanka’s geographic location astride the main East–West shipping lanes, with the Port of Colombo serving as a critical hub for South Asia. The ability to handle both local and regional consolidation in one place is a strategic asset for brands that need scale, speed, and reliability.

The logistics sector is also investing in sustainability and digitalisation – from energy‑efficient warehousing and electric handling equipment to visibility platforms that improve planning and reduce waste. These advances matter to UK brands under rising expectations on climate and due diligence, and they make Sri Lanka’s offer even more compelling.

The wider economic impact

Trade preferences are a means to an end – securing jobs, improving skills, and generating growth. As orders expand, the first beneficiaries are workers in apparel factories, but the effects reach much further. Logistics sector employment grows in warehousing, transport, and freight forwarding. Businesses supplying packaging, trims, accessories, and professional services from testing to compliance and finance see higher demand. This is a whole‑economy value chain, and DCTS aims to help every link become stronger.

For Sri Lanka, the goal is sustained, broad‑based export growth. That requires competitiveness, consistency, and continuous improvement. The conversations I had in the last few weeks gave me confidence. Manufacturers are upgrading capabilities; logistics providers are building capacity; public institutions are building awareness. The UK stands ready to be a long‑term partner in this journey, deepening trade, encouraging investment, and supporting policies that protect communities and the environment.

Our partnership is ultimately about people. When a shipment leaves a Sri Lankan warehouse bound for the UK distribution, it carries with it the skills of machinists, planners, engineers, and drivers; the trust between buyer and supplier; and the shared belief that open, rules‑based trade can deliver real benefits. With DCTS, we have created the conditions for that belief to turn into outcomes with a stronger future for both countries.

The UK will continue to engage closely with Sri Lankan partners to ensure that the benefits of DCTS are realised. That will, I hope mean not only more economical goods on British shelves, but more jobs in Sri Lanka. 

(The author is the British High Commissioner to Sri Lanka)