📈 Apparel Exports Post Strongest Monthly Growth This Year on US Demand

Sri Lanka’s apparel & textiles sector recorded its strongest monthly performance of 2026 in May, driven by a rebound in US demand despite ongoing tariff pressures. • Overall Performance: May 2026 exports grew by 7.96% YoY to US$ 394.14 Mn. However, cumulative exports for Jan-May 2026 stand at US$ 1.93 Bn, down 4.68% YoY due to early-year headwinds. • Market Breakdowns (May 2026): - United States: Up 15.36% YoY to US$ 149.96 Mn, leading the monthly recovery. - Non-Traditional Markets: Rose 14.61% YoY to US$ 70.67 Mn, showing positive diversification. - United Kingdom: Modest growth of 0.87% YoY to US$ 52.16 Mn. - European Union: Declined slightly by 0.3% YoY to US$ 121.35 Mn. • Policy & Tariff Context: The Joint Apparel Association Forum (JAAF) highlights that the US growth reflects strong buyer confidence in Sri Lanka's compliance and reliability. This comes ahead of a critical July 7 public hearing in Washington regarding a US Section 301 review. Sri Lanka faces a potential 12.5% tariff on forced labor import controls, while regional competitors like Bangladesh and Cambodia face 10%. JAAF continues to lobby for tariff parity to sustain this export momentum into the second half of 2026.