Published in Dhaka Tribune on Tuesday, 9 August 2016
Export earnings fall 3.5% in July
Ibrahim Hossain Ovi
Bangladesh’s export earnings have seen a 3.5% fall to $2.53 billion due to negative growth of clothing sector in the first month of current fiscal year compared to the same period a year ago
According to the Export Promotion Bureau (EPB) provisional data, in July 2016, Bangladesh fetched $2.53 billion, which is 3.49% less compared to $2.62 billion in July 2015.
The figure is nearly 25% less than that of the target of $3.37 billion set for the month of July 2016.
Trade analysts and manufacturers as well as the government have attributed Eid vacation to the downtrend of export earnings.
They argued that the factories, especially the RMGs, were closed due to the vacation, which caused less production.
“Negative growth is not expected, but it may be caused by the Eid vacation,” Khondaker Golam Moazzem, additional research director of the Centre for Policy Dialogue (CPD), told the Dhaka Tribune.
There is no connection between the current situation of the country and the work orders executed in July, which were placed two to three months ago, said Moazzem.
“If the downtrend continues, we will have to think about the new measures for reaching the target.”
Meanwhile, the country’s RMG export earnings witnessed a 4.41% decline to $2.11 billion in July, which was $2.22 billion in the same period a year ago. The figure is 23.60% less than the target of $3.03 billion set for the month of July 16.
As per the data, Knitwear products earned $1.07 billion with 4.45% downswing while woven fetched $1.04 billion, posting a 4.36% fall.
In the last fiscal year, Bangladesh earned $28 billion from the country’s apparel industry, which contributed 82% to the overall export of $34.25 billion.
“Production of RMG factories remained closed from 7 to 10 days due to vacation on Eid ul-Fitr. This caused slow production, which is a reason behind the negative growth of export earnings,” Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Mahmud Hasan Khanm Babu told the Dhaka Tribune.
In August and the months to come, the sector will see better growth as the factories are in full-fledged production, he said.
“In June, there were more pressures on the workers to meet the shipment earlier ahead of Eid. As a result, some shipments scheduled for July was done in June, a high official of EPB told the Dhaka Tribune, seeking anonymity.
He argued that some shipments were executed earlier caused less earnings in July while vacation cast a shadow on production.
In June, Bangladesh earned $3.58 billion, posting a 16.74% growth compared to the same period a year ago.
As per the provisional data, leather and leather product export earnings saw 2.26% fall to $92.50 million while leather footwear posted a 4.31% negative growth to $49.70 million. Frozen food and fish exports posted a meager fall by 0.11% to $37.77 million.
Meanwhile, export earnings from jute and jute goods achieved a moderate growth, riding on better performance of raw jute export.
Earnings from jute and jute goods grew by 25.71% to $69.77, while earnings from raw jute increased 74.30% to $25.50 million.