Staff Correspondent: Exports to all major markets of ready-made garments declined. The latest figures show that exports of the staple to the single country’s largest market, the United States, and the European Union (EU), a major alliance market, are lower than in the same period last year. Another market, Canada, has a similar picture. About 85 percent of the total export earnings of ready-made garments come from these conventional markets.
The decline in exports in conventional markets has made entrepreneurs worried. If such situation continues, it may cause danger for the export sector. Exporters are worried about whether strained relations with the US and fears of sanctions over labor rights issues will affect exports in the coming days.
In addition, the US central bank, the Federal Reserve, is trying to control imports by increasing policy interest rates to curb inflation.
When asked about the reasons and consequences of the decrease in exports, BGMEA president Farooq Hasan said that the decrease in exports in the conventional market is definitely a cause for concern. Overall apparel exports may turn negative at the end of the current fiscal year due to decline in exports to major markets.
The BGMEA president noted that not only Bangladesh’s exports have decreased; Exports of all competing countries in Europe and America are declining. The rate of decline in Bangladesh’s exports is lower than that of its two main competitors, China and Vietnam. Exports are decreasing due to the global economic situation and the declining demand and various policies of the western countries.
According to the Export Promotion Bureau (EPB) and BGMEA, exports to the EU fell by 0.15 percent in the five months from July to November of the current fiscal year compared to the same period of the previous fiscal year. Exports there were over 4 percent in the four months to July-October. Among the last three fiscal years, exports to the European Union increased by nearly 10 percent in fiscal year 2022-23. 2021-22 saw an increase of 34 per cent and 14 per cent in the previous financial year. In the last five months, apparel exports to alliance countries were worth $9.05 billion, which was $9.07 billion in the same period of the previous fiscal year. The EU’s share of total export earnings fell from 49.48 to 47 percent.
The largest market within the EU is Germany. About $7 billion worth of clothing is exported to the country annually. Exports to Germany have fallen by 15 percent in the last five months. Garments worth $231 million were exported. It was $2.72 billion in the same period of last financial year. Exports to Germany decreased by $41 million or more than Tk 4,500 million. Trade analyst and chairman of research firm Rapid Abdur Razzak thinks that Germany is going through a lot of recession. The country’s trade has declined. Imports and exports have all decreased. Because of this, like all other countries, Bangladesh’s garment exports have decreased.
Among other major markets, apparel exports to the United States have declined by 5.76 percent in the last five months. $328 million worth of clothing went to that country. It was $348 million in the same period of last financial year. Exports decreased by $20 million or about Tk 2,200 million. The US share of total apparel exports fell to 17 percent due to declining exports. It was 19 percent in the same period last fiscal.
Dr. Abdur Razzaq said the reason for the decline in exports to the US market as many are trying to say that exports to the United States have decreased due to political reasons due to fear of sanctions. But so far politics is not the reason. Exports of Bangladesh like all other countries have also decreased due to reduced demand in the country. Of course, the future cannot be said. In that case the situation may be different. Because, if the United States takes a decision, it implements it with its allies.
In the five months under discussion, exports to Canada, another common market, decreased by 2.71 percent. Garments worth less than $61 million are exported to the country. Which was more than $62 million in the same period of the previous financial year. The share of this market in the total exports of garments has decreased from 3.40 to 3.22 percent.
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