Sri Lankan garment manufacturers have secured enhanced access to the UK market following the implementation of liberalised trade rules under the United Kingdom’s Developing Countries Trading Scheme (DCTS), which came into effect on January 1, 2026.
Under the new arrangements, apparel exporters from Sri Lanka can source up to 100 per cent of their raw materials from any country worldwide while continuing to enjoy zero-tariff entry to the UK. The reforms mark a significant departure from previous rules, which required at least two major manufacturing processes to be carried out locally to qualify for duty-free access.
The changes are expected to substantially improve the competitiveness of Sri Lanka’s apparel sector by allowing manufacturers greater flexibility in sourcing inputs and integrating more effectively into global supply chains. Industry analysts say the move will help exporters respond faster to international buyer requirements and manage production costs more efficiently.
In addition to garments, the revised scheme introduces an Asia Regional Cumulation Group comprising 18 countries, applicable to other Sri Lankan exports. This enables exporters to source materials from regional partners while retaining preferential tariff benefits in the UK market.
British High Commissioner to Sri Lanka, H.E. Andrew Patrick, said the reforms demonstrate the UK’s commitment to fostering shared prosperity through stronger trade partnerships. He noted that simplified rules of origin would support Sri Lanka’s economic growth by improving market access and encouraging export diversification, while urging exporters to make greater use of the scheme.
The apparel industry has welcomed the reforms as a timely boost to one of Sri Lanka’s most important export sectors. The garment industry accounts for more than 60 per cent of Sri Lanka’s exports to the UK and supports around one million livelihoods across the country.
The Council for Business with Britain (CBB) said the reforms would further strengthen UK–Sri Lanka trade ties. With over 90 per cent of products now eligible for zero tariffs under the DCTS, the council expressed optimism that exporters in other sectors would also benefit and increase utilisation of the scheme.
The UK is currently Sri Lanka’s second-largest garment export destination, with exports valued at approximately USD 675 million. With the new tariff-free access and relaxed sourcing rules now in place, exports to the UK are expected to increase significantly in the coming years.
