Home ›› 03 Aug 2022 ›› Front
Navigating the troubled waters of global political and economic crises, Bangladesh’s export earnings in July – the first month of ongoing FY23 – reached $3.98 billion, which is a 14.72 per cent increase compared to $3.47 billion posted during the same month last FY.
Riding on the apparel sector, the country’s export earnings for July was 1.65 per cent higher than the government target of $3.92 billion, according to the Export Promotion Bureau (EPB) data.
Apparel sector, the largest foreign currency earner, has contributed 84.49 per cent or $3.37 billion to July’s earnings. Of the figure, knitwear products fetched $1.85 billion and posted an 11.8 per cent growth, while the woven sector recorded a 23.11 per cent rise to $1.51 billion.
However, when compared to previous months, the growth rate and export values have declined in July. The industries also could not export for five days in that month due to Eid-ul-Azha holidays.
Export earnings from primary commodities – such as fish and vegetables – also declined by 25.94 per cent to $99.94 million, which was $134.95 million in July 2021.
Industry insiders and economists claimed that although the export performance this July is excellent considering the time was a lean period, the orders were received in March-April.
The impact of the global economic crisis will begin to show after this August during the exports of the May-June Utilisation Declaration (UD) goods, they added.
Speaking to The Business Post, Research and Policy Integration for Development (RAPID) Chairman Mohammad Abdur Razzaque said, “The 15 per cent export growth is excellent considering the ongoing situation.
“But we have to understand that these orders came when the global economic crisis had just started. Our headache will begin in September, and during that period, it will be very tough to maintain this growth rate.”
He continued, “However, due to the clash between US and China, Bangladesh’s apparel sector will continue to benefit, which in turn will help increase the export earnings. The appreciation of USD against Taka will also help us be more competitive in the global market.”
The EPB data showed that the apparel sector earned $3.37 billion in July 2022 which is 16.61 per cent higher than the same period of the previous year and 6.45 per cent higher than the target.
On the issue, Bangladesh Knitwear Manufacturer and Exporters Association Executive President Mohammad Hatem said, “Excluding May, our export earnings exceeded $4 billion since September 2021, and the growth rate was above 20 per cent.
“But in July, our export and growth rate both dropped. It means that the global economic crisis has already hit our export sector.”
Though their export earnings increased slightly in July of FY23, the home textile sector failed to meet the export target. EPB data shows that the sector’s earnings rose by 3.89 per cent to $96 million, which is 28.3 per cent lower than the target.
Industry insiders say their export performance was disrupted due to the Russia-Ukraine war, as Russia is their emerging market. But the Russian buyers are returning, and this will help them boost their export earnings.
M Shahadat Hossain Sohel, chairman of the Bangladesh Terry Towel & Linen Manufacturers & Exporters Association, said, “Although the war impacted our export earnings, we expected to earn above $2 billion at the end of FY23.
“Our buyers have already started placing their orders and we will be able to see a positive impact after two to three months.”
Leather and leather goods
In this July, the leather and leather goods sector earned $99.41 million through exports, which is 9.82 per cent higher than July 2021. The sector also posted a 2.15 per cent higher figure than the export target.
Ashikur Rahman, managing director of Tajin Leather Corporation, said, “If the government halts wet blue exports and supports us in creating new markets, this sector will have the capacity to earn above $3 billion with our current setup.
“The LWG certification is our major headache, and the government should focus on this.”
Jute and jute goods
EPB data shows that the jute and jute goods sector started the new FY with a positive growth rate, while it was negative the entire FY22. In July FY23, the sector’s earnings rose by 5.17 per cent to $63.91 million, though it is still 26.12 per cent lower than the government target.
Esrat Jahan Chowdhury, director of the Bangladesh Jute Goods Exporters Association, said, “EPB data showed positive growth because our exports dropped by 41 per cent in July 2021.
“Due to the war, global economic crisis and high freight fares, our export orders dropped, and it will hit our earnings.”
Other exports
EPB data shows that during this period, export earnings from primary commodities dropped by 25.94 per cent to $99.94 million, which is 27.09 per cent lower than target.
Frozen and live fish export earnings dropped by 2.12 per cent to $36 million, which was around $37 million in July of FY22. On the other hand, agriculture product export earnings dropped by 34.89 per cent to $64 million, which was $98 million in July of previous FY.
Moreover, export earnings from the pharmaceutical sector also dropped by 28.23 per cent to $13 million, which was $18 million in the July of FY22.
