The higher trade tariffs imposed by the United States on Sri Lanka can put a significant number of jobs in the country’s apparel industry at risk in the near future, warns Professor Wasantha Athukorala from the Department of Economics and Statistics at the University of Peradeniya.

On Wednesday, US President Donald Trump announced a sweeping set of reciprocal tariffs, imposing a baseline 10% tax on all imports and significantly higher rates on dozens of countries with which the US runs trade deficits.

As a result, Sri Lanka now faces the 6th highest tariff rates in the world—44%, a sharp increase from the previous 12.2% tariff rate.

Currently, 25% of Sri Lanka’s total exports—primarily apparel—are destined for the US. Reports indicate that Sri Lanka’s export earnings from the US amounted to USD 3 billion in 2024, with USD 346 million earned in January 2025 alone.

However, Prof. Athukorala warns that these high tariffs could severely impact Sri Lanka’s exports, particularly the apparel industry, as the US remains a key market for the country’s textiles. 

He cautioned that export income could decline significantly, posing a serious threat to employment in the sector.

Furthermore, he stressed that if Sri Lanka’s exports take a hit, a large number of workers in the apparel industry could lose their jobs in the near future.