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Bangladesh - March 14, 2022

Leather product export turns around again

Golam Mostafa Jibon: Leather product export has started turning around day by day with the ease of corona pandemic worldwide. As a result, hide and skin traders have started to see the ray of hope again after a long crisis.
Insiders said, although, the government took various initiatives to increase exports, it was not getting much benefit due to various complications including virus pandemic. Not only at the government level, but also privately, various initiatives were taken to increase exports.
The benefits of those initiatives have now started to come. The long-declining leather sector is waking up again. Export income has also started increasing.
According to the Export Promotion Bureau (EPB), producers exported hide and skin products worth $784.9 million between July and February, which is 29 percent more than the same period of last financial year. From July to February of the last financial year, the export was $ 605.5 million. In the same period of 2019-20 fiscal year, the export of goods was $ 631.8 million.
According to the EPB, exports of leather and leather products including footwear increased by 36.61 percent, 35.34 percent and 25.89 percent respectively in the first eight months of the current financial year. Exporters said, there is a lot of buying order in the leather sector. Exports may increase in the future. European countries are the main market for leather and leather products in Bangladesh. The product is also exported to several other countries, including the United States (US) and Japan.
These countries have returned to normal after being closed for almost two years due to the epidemic. All kinds of shopping malls, big and small markets have reopened. People are shopping in full swing now. The economy is back on track. Like other products, demand for leather products is increasing. That is why, exports are increasing, said the exporters.
According to the Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh, China accounts for 55 percent of the global shoe market. India and Vietnam also have good positions. Bangladesh’s position in the special shoe market is 18th. However, Bangladesh’s contribution to this sector in the world market is only 1.7 percent.
After corona, new possibilities have also emerged in the export of leather sector like readymade garments. Some orders from China, the main exporting country, have started coming to Bangladesh. Orders are also coming from Vietnam. Bangladesh’s exporters have said that, if these opportunities are utilized well, exports will increase further in the future.
According to the Export Promotion Bureau (EPB), Bangladesh earned $113 crore by exporting leather and leather products in the 2014-15 financial year. In the 2015-16 financial year, it increased to $116 crore. In the 2017-2018 financial year, this income increased further to $123.40 crore, which was the highest export income from the leather industry in the history of Bangladesh.
Since then, the export of this sector faces a collapse. In the 2017-18 financial year, it came down to $108.54 crore. In the 2018-19 financial year, it dropped further to $102 crore. In the 2019-20 fiscal year, it came down further to $79.76 crore. Even in the midst of the epidemic, Bangladeshi exporters brought in $941.7 million in foreign exchange from the export of leather and leather products in the fiscal year 2020-21. In terms of money, this amount is more than Tk 8,000 crore.
Exports increased by 18 percent over the previous year. In the first part of the financial year, the exports of this sector declined, but in the second half, it turned around and returned to growth. From the beginning of the current 2021-22 financial year, a positive trend can be noticed in the export of leather and leather products. Exports have increased every month. The latest data shows that in the first eightmonths of the fiscal year (July to February), $784.9 million came to the country from the exports of this sector. Growth has been 29 percent; Income has increased more than the target by about 14 percent.
Of this income, $475 million is from leather shoe exports. Exports leather bags, luggage, wallets, belts and other products. The export of raw and wet-blue leather has earned $10.2 crore in these eight months. During July-February last year, Bangladesh earned $60.56 crore from this sector. The government has taken various initiatives to increase the export of leather goods. In order to make this sector environmentally friendly, a project was undertaken in 2003 to relocate from Hazaribagh to Savar, a leather industrial city. The project was to be completed in three years. But even after a decade and a half, this industrial city has not yet become environmentally friendly. Although the project was not completed, in 2017 the High Court announced the closure of the Hazaribagh leather factory. As a result, all the factories were closed. Several of these were certified by the Leather Working Group (LWG), a global platform for leather factories. Thanks to this charter, they could export leather to Japan, Korea, Europe and America. The tannery factories lost the certificate and the buyer (foreign buyer) due to the closure of the factory in Hazaribagh. Even after such a long time, the leather industrial city of Savar has not been fully prepared and the factories have not yet got the LWG certificate back. At the same time, new markets were not created. Factories are not able to export leather under LWG to Japan, Korea and Europe-America due to lack of certification.

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