"Call to action on Sri Lanka's economic crisis", 9 August 2022

Today, the people of Sri Lanka are experiencing daily power outages, and are unable to buy essentials such as food, fuel, or medical supplies, when these are available. Severe shortages have stoked inflation as high as 70%, with political instability and wide social unrest also impacting the economy. While a new president has now taken office, economic volatility and public protests remain ongoing.

In recent months, a set of special measures have been taken by government to secure industry operations it deems essential. These have included provisions by the Central Bank to ensure smooth cash flow and permissions to directly procure raw materials such as diesel from offshore; to address power outages and arrange alternative services for logistics, such as the transportation of workers to and from the workplace...

A collective response

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To facilitate a collective response, ETI convened a meeting for all companies sourcing from Sri Lanka to engage with the Joint Apparel Association Forum (JAAF). ETI, Fair Wear Foundation, Fair Labor Association and British Retail Consortium reached out to their own members and partners with supply chains in the country...

Call to action

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We join other calls, in urging the international community to aid Sri Lanka, where possible, with much needed financial and technical support, to prevent the current economic crisis from deteriorating into a humanitarian one. We call upon business specifically, to support the Sri Lankan apparel industry and keep workers and their families afloat during this time of crisis. We, the undersigned, encourage companies sourcing from Sri Lanka take the following actions:

• Ensure that there is a clear understanding of the risk to workers in the current situation.
• Maintain regular communications with your suppliers to understand their current situation and ensure timely payment of orders.
• Avoid cancellation of orders and assure suppliers of business continuity for the time being.
• Ensure all pending wages and severance payments are paid to all employees and workers.
• Review negotiated prices and ensure future price negotiations include the increase in costs for energy, other raw materials and labour exposed to inflation.
• Engage with unions and suppliers to explore innovative remedial solutions to support workers.
• Work collaboratively to consider other actions to improve respect for human rights in the context of Sri Lanka’s economic crisis.