There has been a significant rise in the export of leather footwear due to increasing investment in this sector. The export growth shows that Bangladeshi entrepreneurs are putting in money in compliant factories to produce high-quality footwear.The leather footwear sector registered a steady growth of 6.60 per cent by earning USD 460.14 million in first 10 months (July–April) of the current financial year (FY2017–18). It had earned USD 431.65 million during the same period in FY2016-17, according to Export Promotion Bureau (EPB) data.Saiful Islam, president of the Leather Goods and Footwear Manufacturers’ and Exporters’ of Bangladesh (LFMEAB), told The Independent that the steady growth could be attributed to three factors. “First of all, factories producing footwear in Bangladesh are environmentally compliant—they conform to environmental laws, regulations and standards,” he said.“Second, we’re getting the benefits of investment in this sector. This is reflecting the growth prospects in the long term. As a result, 20 new export-oriented footwear factories have come up and started operations in Bangladesh in FY2017–18,” he noted.”Finally, labour costs are increasing in China, prompting a shift to high-tech industries in that country. So, if investors decide to move to a cost-competitive manufacturing base, Bangladesh would be the most lucrative option,” he added.He said Bangladesh was exporting footwear to European Union (EU) member countries, Japan and North America.When asked about the challenges, Saiful Islam said: “This sector faces some challenges. They include reduction of the lead time to within 45 days, establishment of more compliant footwear factories, and long-term policy support.”The leather sector is the country’s second largest export earner with an income of over USD 1 billion. It also directly and indirectly employs about one million people, he added.Saiful Islam noted that competitive pricing, low labour cost and available raw material could help Bangladesh grab a bigger share of the global market of leather products. “If a long-term sustainable policy support is implemented, it’s possible to achieve a growth level of 15- 20 per cent instead of 6.60 per cent,” he added.Dr Khondaker Golam Moazzem, research director at the Centre for Policy Dialogue (CPD), told The Independent: “The export of leather footwear in the first 10 months of FY2017–18 is 6.60 per cent, which shows that, after meeting the domestic demand, we’re performing successfully in the global arena.”Explaining the opportunities before this sector, Bangladesh Tanners’ Association (BTA) Chairman Shaheen Ahmed said thanks to the availability of raw materials, 350 million sq ft of leather is produced annually in Bangladesh. Of this amount, 20–25 per cent goes to meet the domestic demand, while the rest is exported.The government considers “leather goods and footwear” as one of the main growth generators for the country to cross the middle-income threshold.According to LFMEAB, approximately 220 tanneries, 2,500 footwear manufacturing units and 90 large firms are involved in making leather goods and footwear mainly for exports.Bangladesh exports leather goods and footwear mainly to the UAE, Argentina, Austria, Australia, Belgium, Canada, Switzerland, Chile, China, Germany, Denmark, Italy, Spain and Finland.
