With Sri Lanka's two main apparel industry markets - the US and the EU - going into recession, the country's garment exports are expected to drop 10%-15% in 2009 costing tens of thousands of jobs.

"We are expecting a 10%-15% downturn in exports this year because of retail closures and drop in sales in major markets," said Mr Ajith Dias, the head of the Joint Apparel Association Forum (JAAF), the garment trade representative body, at a media workshop on the global recession. 

At this point apparel industry order books are full, because these orders were procured by the end of 2008. 

However, the drop in orders in 2009 is expected to translate into factory closures and consolidations that could result in about 30,000 fewer jobs.

Factories are already cutting down at middle management level, and are not re-filling vacancies when shop floor workers like sewing machine operators leave, further reducing workforces.

But the industry is hoping to recover market losses by expanding in other areas.

"Despite the downturn we expect demand in certain areas to grow. We are hoping to identify these areas and target them," said Mr Dias.

In the longer term, Sri Lanka is also looking at developing new markets like China, Japan and India through government bilateral agreements.

The industry is also hoping to use the GSP+ duty free trade scheme for preferential access into EU markets - at least until the end of 2009 - pending an investigation by the EC on the implementation of human rights conventions.

By Dilshani Samaraweera.