Wednesday Jun 24, 2026
Wednesday Jun 24, 2026
Wednesday, 24 June 2026 00:26 - - {{hitsCtrl.values.hits}}
Sri Lanka’s apparel and textile exports grew 7.96% in May 2026 to $ 394.14 million, marking the industry’s strongest monthly performance so far this year and signalling improving demand from key export markets after a challenging start to 2026.
According to data analysed by the Joint Apparel Association Forum (JAAF), the United States led the gain, with shipments rising 15.36% to $ 149.96 million. Exports to markets outside the industry’s traditional three core destinations also grew strongly, increasing 14.61% to $ 70.67 million, while the UK posted modest growth of 0.87%. The EU was the only market to soften, declining 0.3% to
$ 121.35 million.
JAAF said, the US rebound comes at a pivotal moment for the sector. Sri Lanka is currently engaging with the US Trade Representative on the Section 301 investigation into the prohibition of the importation of goods manufactured with forced labour, which will determine an additional tariff of either 10% or 12.5%.
The report published in June places Sri Lanka among the 46 countries due to face a 12.5% tariff. Several of Sri Lanka’s competitor countries, including Bangladesh, Cambodia, Pakistan and Indonesia, have been assigned a lower tariff of 10% on account of actions already taken regarding the importation of goods manufactured with forced labour.
A public hearing on the proposal is scheduled for 7 July in Washington, and industry bodies had until 22 June to request a hearing slot, making the coming weeks a critical period for Sri Lanka to present its case.
This is precisely where the policy conversation and the trade numbers intersect, JAAF noted. May’s strong US performance shows that, even under tariff pressure, Sri Lanka remains a market from which US buyers are actively sourcing, reflecting the country’s long-standing reputation for quality, compliance and reliability. The opportunity now is to convert that underlying buyer confidence into a more durable trading position by securing a more favourable tariff outcome.
JAAF has consistently lobbied for tariffs to be aligned with those imposed on competitor countries.
A successful outcome for Sri Lanka in the current process would help convert May’s encouraging performance into sustained growth.
The cumulative picture for the year, however, continues to reflect the headwinds the industry has been navigating.
Exports for January-May 2026 stood at $ 1,926.85 million, down 4.68% from the corresponding period last year, with the US, EU and UK all remaining in negative territory on a cumulative basis. However, May’s performance suggests the industry has scope to recover lost ground in the second half of the year, particularly if the tariff issue is resolved favourably and buyer confidence continues to strengthen.
JAAF said: “May’s numbers are genuinely encouraging, and they reflect the trust our buyers continue to place in Sri Lankan manufacturing even amid a challenging trade environment. Our focus now is on securing a fair and competitive tariff outcome in Washington, so that this momentum can translate into long-term growth rather than a short-term gain. We remain confident that with the right policy support, the second half of 2026 can be considerably stronger for the sector.”
With the US hearing process now entering its most consequential phase, the next few months will be a key test of whether Sri Lanka can secure a more competitive position in its largest market and turn May’s strong performance into the start of a sustained recovery for the sector.
