Next abruptly closes owned Sri Lanka factory
UK fashion retail giant Next has 'abruptly' shuttered one of its three Sri Lankan factories with the loss of 1,400 jobs.
A trade union official is quoted as saying that over 800 of its members were out of work, as the annoucement sparked protests, according to online publication EasternEye.
Next Manufacturing – a subsidiary of Next – confirmed it is closing the factory in response to high operating costs. The factory in the island's Katunayake Free Trade Zone, just outside the capital Colombo, announced its immediate closure and promised severance deals to 1,416 workers made redundant overnight.
David Reay, director of manufacturing at Next, said the plant had been unprofitable for several years and that he had no alternative but to close it.
'At the heart of this decision is the increasingly high operating cost of the Katunayake manufacturing plant,' Reay said in a statement, adding the company will continue to operate two other factories on the island.
The Free Trade Zones and General Services Employees Union rejected the claim that the factory was unviable with its general secretary Anton Marcus saying: 'The decision to close without any consultation with us is a violation of a collective agreement.'
Last month, Sri Lanka's apparel industry warned that threatened US tariffs would disrupt the island's largest export sector and place thousands of jobs at risk.
The report said Sri Lanka exported $4.76 billion (£3.76 billion) worth of garments last year, up from £3.58 billion the previous year. The industry employs about 350,000 workers and is a key foreign exchange earner.
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