With less than 6 weeks to go before global textile and apparel quotas are lifted, Sri Lanka's Joint Apparel Association Forum (JAAF) has launched an Apparel Sector Productivity Improvement Programme to boost output and cut costs at 100 factories.

The government-funded initiative, which is part of JAAF's 5-year strategy to improve the competitiveness of the clothing sector, will provide registered export-oriented manufacturers with an interest-free loan.

In return, the factories will be required to dedicate a core team to training and improvement within key areas. Productivity progress - and associated cost reductions - will be benchmarked against at least 20 known performance measures and jointly agreed targets set.

The project team based at the Clothing Industry Training Institute in Ratmalana, Colombo, is implementing the programme under international consultant Peter Wilson.

It hopes to increase the industry's productivity by at least 30 per cent.

The elimination of quotas at the end of 2004 is likely to lead to substantial job losses in the Sri Lankan textile and clothing industry as companies struggle to compete with large suppliers such as China and India and their integrated manufacturing facilities. This problem is likely to be particularly acute in rural areas where there is little alternative employment.

The disappearance of the protective umbrella of quotas also comes as Sri Lanka is trying to recover from the effects of two decades of a debilitating conflict in the North and East. Rising oil prices have added to the difficulties.

The Sri Lankan apparel industry's 5-year strategy aims to double the sector's turnover by 2007; transform it from a "manufacturer" to a provider of a "fully integrated service"; increase penetration at the premium end of the market; build its reputation as a superior manufacturer of specific product categories; and consolidate and strengthen the industry to meet the challenges of the quota-free era.