US buyers in talks with Sri Lanka exporters to share Trump tax
S buyers are in talks with Sri Lanka exporters to share the 10 percent tax slapped on imports, to reduce the burden on consumers, and exporters are also trying to cut costs, an industry official said.
US brands had initiated discussion during the April holidays after the tax hit in the first week. Factories typically close in April and export
“There have been conversations as early as the Aurudu week,” Hasitha Premaratne, Managing Director & Chief Strategy and Transformation Officer, at Brandix said at a forum organized by the Sri Lanka US Business Council of the Ceylon Chamber of Commerce.
“Of course, we didn’t have too much of time during the Aurudu to celebrate, because we had to get back to the drawing boards and look at how we need to bounce back on these conversations.
In addition to operations in Sri Lanka, the group also has a presence in India and other regions.
“One or two of them have been very nice to say that they’re not going to pass on anything to the supply chain,” Premaratne said.
“But everybody else has said, no, we have to share. And different percentages have been set as the expectation. So we have gone back with proposals.
“And obviously, it’s in negotiation at the moment. So surely there will be an impact on our margins.”
Exporters are also attempting to reduce costs and pass the some of the cost along the supply chain.
Brandix itself has fabric factories.
After an inflation bout, global commodity prices have been easing since from around May 2022 the Fed started hiking rates and quantity tightening in 2022, data show.
Falling energy and cotton prices, from a deflationary slowdown in the US could also bring down costs.
Buyers also wanted to know what the government was doing to mitigate the problem, and they were updated on progress in talks made so far, Premaratne said.
