The country registered a trade deficit of $77 million in July, the first month of the financial year 2015-16, against a trade surplus of 195 million in the corresponding period of the FY15 for lower export earnings against higher import payments.Officials of Bangladesh Bank and a leading economist said falling export growth of readymade garment, the main export product of the country, dented the overall earnings in July. The country’s trade deficit hit its all-time high at $9.91 billion in the last financial year due to the slower export earnings growth. The export earnings logged a 12.18-per cent negative growth in July compared with that of 1.03 per cent negative growth in the same period of FY15. The export earnings stood at $2.60 billion in July of the FY16 while it was $2.96 billion during the same period of the FY15. The export earnings were $2.99 billion in July of the FY14. The imports also registered a 3.21 per cent negative growth in the first month of the FY16 compared with that of 11.36 per cent growth in the corresponding period of the FY15. The import payment stood at $2.68 billion in July of the FY16 and it was $2.77 billion in the same period of the FY15. The import payment was $3.12 billion in July of the FY14. Former interim government’s finance adviser AB Mirza Azizul Islam told New Age on Monday that it was a negative sign that both export earnings and import payment had registered a negative growth in July. The lower export growth in recent period has already created a worrisome situation for the country’s business sector, he said. The government should search for the new market and diversify its exported products to boost up the export earnings, said the economist. The BB data showed that the shipment of RMG products decreased by 12.03 per cent to $2.21 billion in July compared with that of $ 2.51 billion in the same month of the FY15. Mirza Aziz said that the countries of the European Union had been facing economic crisis for long which put an adverse impact on the export of RMG products there. The country registered a negative import growth in the period although the import of capital machinery increased, he said. ‘The import growth of capital machinery was much higher than that of industrial raw materials, but the businesspeople took little initiative to expand their business in the period due to political uncertainty,’ Mirza Aziz said. He feared that the importers might now be making over-invoicing to launder money abroad as the recent higher import growth of capital machinery had not put any major positive impact on the industrial sector. The BB data showed that the current account balance decreased to $818 million in the first month of the FY16 against $972 million during the same period a financial year ago. The net foreign direct investment increased by 11.27 per cent to $158 million in July from that of $142 million in the corresponding period of the FY15. The BB data showed that the financial account of the country’s balance of payments posted a surplus of $86 million in the first month of the FY16 from a deficit amount of $151 million during the same period of the FY15. The financial account includes foreign direct investment, portfolio investment, and medium- and long-term loans. The country’s overall balance increased by 118.86 per cent to $ 1.04 billion in July against $477 million during the same period of the FY15 due to its strong position in the financial account, the BB data showed.
