Earnings from apparel exports plunged by 3.47 percent in the first six months of the current calendar year compared to the same previous period mainly due to a decrease in global demand.RMG exports stood at $14.44 billion in the January-June period of 2017 from $14.95 billion during the corresponding period last year, according to the latest export figures of Export Promotion Bureau (EPB).Exporters said when competitors like Vietnam and Cambodia are posting double-digit growth in apparel exports, Bangladesh is losing its competitiveness in the global market.They blamed depreciation of the pound sterling against the dollar and Bangladeshi exporters’ failure in reducing the lead time for the decline in RMG exports. RMG exports saw 2.96 percent growth in January this year before slipping into negative territory in February, when the earnings decreased by 5.95 percent.The growth was negative in March by 0.97 percent but posted positive in April and May.The earning from overseas market dropped 16.13 percent in June.Bangladesh’s RMG exports stood at $28.14 billion in FY 2016-17, which was 0.20 percent higher than $28.09 billion in the previous year.The country’s largest export-earning sector makes up 87 percent of the total export earnings and 16 percent of the GDP.Since the beginning of its long journey, the RMG sector saw negative export growth only once in 2001-02 fiscal year — by 5.68 percent to $4.58 billion.“Bangladesh is losing its competitiveness in the global market while our competitors are topping the growth chart,” said Faruque Hassan, vice-president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).”This is a very alarming situation for the apparel sector.The exporters need to find out the reasons behind the slowdown,” he said.The BGMEA leader also observed that the exporters should focus on producing high-end products to make their earnings bigger while keeping the production costs at the same level.Exporters Association of Bangladesh (EAB) President Abdus Salam Murshedy said RMG exports marked a mere 0.20 percent growth last fiscal though the growth rate hovered around 13 percent only three years ago.He also underscored the need for infrastructure and policy support, long-term tax policy and incentives to help the apparel exporters retain a steady export growth.“There are multiple factors behind the negative export growth. Rising production cost and decreasing demand in the international market are some of the factors causing the slowdown,” said Shafiul Islam Mohiuddin, president of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI).“We are constantly failing to reduce the lead time due to lack of raw materials, and as a result, many exporters can’t deliver product samples in time. If we could make the deliveries timely, we could make another $ 2-3 billion last year,” he said. Shafiul Islam Mohiuddin also said neighbouring India is targeting to become the world’s largest RMG exporter by 2030, and the Indian government has been providing all-out policy support to its apparel sector. “The global demand for apparel items has been slowing down in the last few year, which affected RMG exports from many countries,” said Dr Khondaker Golam Moazzem, additional research director of Centre for Policy Dialogue (CPD).“The global RMG market witnessed a 6.9 percent and 1.5 percent negative growth in FY 2014-15 and FY 2015-16 respectively. The negative growth has had an impact on the global trade volume and prices of apparel products,” he added.Golam Moazzem also informed that the Chinese and Indian apparel exporters saw 9.7 percent and 1 percent negative growth respectively in FY 2015-16. However, Vietnam and Cambodia are keeping their growth momentum at 15.1 percent and 12 percent growth respectively.He said the RMG exporters should focus on a short-term policy towards boosting exports to the most favourable markets as well as producing high-end products and exploring new markets.The government should also focus on bringing foreign investment in the non-garment sector, he added.
