Country’s trade deficit in 11 months of the last financial year (2014-150 widened to $9.46 billion from $6.18 billion in the same period of the previous fiscal as import payments far exceeded export receipts. In the previous fiscal, the trade deficit was $7.0 billion, the Market Update of Citi released on Wednesday said. The current account slipped into negative territory with a deficit of $2.0 billion during July-May period, which posted a $1.36 billion surplus during the same period of last fiscal. The overall Balance of Payments (BoP) came down to $3.59 billion during the period from $4.97 billion in the corresponding period of FY14. Exports rose 3.35 percent year-on-year to $31.2 billion in FY15 from $30.19 billion in FY14. Exports have been riding on the slow lane for majority of FY15 period as garments exports, which makes up for the lion’s share of Bangladesh export earnings showed limited growth, the update added. Exporters also faced added difficulties in Euro zone, which accounts for close to 60 percent of the country’s export earnings, as Euro zone growth remained sluggish and Euro depreciated by over 20 percent against the Bangladesh Taka hurting price competitiveness. But from March this year, exports started picking up due to the apparel retailers’ reinstatement of confidence in Bangladeshi garments industry after positive notes on workers safety standards by two foreign inspections agencies Accord and Alliance. For the fiscal year of 2015-2016, the Export Promotion Bureau (EPB) has set a target of $33.50 billion in exports. To achieve the export target for the upcoming years, the primary challenge lies in export diversification strategy both geographically and in terms of concentration. Moreover, the export basket needs to be broadened where the pharmaceutical industry and software exports have the potential to take up the baton from the garments industry, the update suggested. Imports grew 12.20 percent to $37.23 billion during the 11 months of FY15 against $33.18 billion in the corresponding period of the previous fiscal, whereas import settlements for July-May period amounted to $35.17 billion, up 3.81 percent from $33.88 billion for the same period last fiscal. Payment of import bills for fuel shrank due to slump in price in the international market. As per central bank reports, capital machinery and raw materials imports made up most of the rise in imports, which also implies that investments are on the rise and an expansion of production capacity in the near term.
