The country’s overall export further experienced a negative year-on-year (YoY) growth in December of 2023 by 1.06% to $5.30 billion, which was $5.36 in December of 2022, according to data from the Export Promotion Bureau (EPB).
However, export earnings in December 2023 were the highest single-month earnings in 2023. December’s export was also 5.57% lower than the target set at $5.62 billion.
The slowdown may particularly be caused by the global economic turmoil and a continuous slowdown in purchase orders due to lowering global retail sales and demand also impacted the export scenario.
Moreover, during the labour unrest in the last few months, several big players in the export industry were bound to close their factories to avoid vandalism, which also impacted the overall export earnings, said the exporters.
The apparel sector, the highest earner among export receipts, witnessed a fall by 2.35% to $4.56 billion, which was $4.66 billion during December of last financial year, EPB data stated.
However, during the first half of FY24 (July-December or H1 of FY24), overall exports registered an extremely narrow growth of 0.84% to $27.54 billion, very little up from $27.31 billion during the mentioned period of the last fiscal.
The overall export target was set at $30.11 billion, 8.55% higher than the achieved export earnings.
During the period in question, apparel exports reached $23.39 billion, fetching a very thin YoY growth of 1.72%, from $22.99 billion in the same period of FY23.
Among apparel products, knitwear export reached $13.48 billion, while export from woven items was $9.91 billion with 6.48% positive growth and 4.12% negative growth respectively, compared to FY23.
Export from other sectors
However, except for a thin positive growth of the RMG sector, export earnings from all the major sectors witnessed negative growth in the H1 of FY24.
Among other notable sectors, home textile marked a negative growth of 38.38% to $369.91 million, down from $601.26 million in the mentioned period of last fiscal.
Leather and leather goods also experienced a negative growth of 17.93% to $523.03 million, which was $637.29 million in the H1 of FY23.
In the July-December period of FY24, the export earnings from agricultural products stood at $507.93 million, fetching a positive growth, after a mentionable period, of 2.28% from $496.63 million in the same period of last fiscal.
Export receipts from jute and jute goods again experienced negative growth of 10.24% to $436.12 million, down from $485.88 million in July-December of FY23, EPB data stated.
Another potential export sector, engineering products, again fetched a negative growth of 3.08% to $253.05 million, down from $261.09 million in the same period of last FY.
What exporters say
Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that the monthly growth has been negative for the last few months.
“In the beginning we were able to cover some of this negative growth with value, while the quantity was decreasing but the value was increasing. But now the value has also started going negative due to which our growth has been negative for the last 3 months,” he added.
He also said that in the future they have to face many challenges as the minimum wages in factories have increased, bank interest rates have hiked, gas and electricity prices have gone up due to which the cost of production has gone up a lot.
“It will be very difficult for us to implement the new orders. That’s why we need everyone’s cooperation,” he added.
Regarding the economic turnaround in the West, he said that with inflation in Europe and the US coming down, hopefully exports will also have a turnaround.
“Retail shops in our export destinations had good consumer responses in November and December. However, it is not yet time to say that the market has improved, but there have been some promising developments,” he added.
BGMEA Director Mohiuddin Rubel said that Bangladesh did fairly well despite imports of major markets declining as most of the advanced economies are struggling due to high inflation and impact on consumers due to monetary policy measures taken to contain inflation.
“Since the growth curve of global clothing trade falters every year, we believe that 2024 will be a year of turnaround. The positive side is that despite all the challenges the industry continued its commitment and efforts toward sustainability like the declaration of minimum wage and the transformation of green industrialization,” he added.
RMG Export scenario 2023
The EPB also published the export scenario of the RMG sector in 2023. According to the EPB data, the RMG export experienced a slight positive growth of 3.67% to $47.39 billion in 2023, up from $45.71 billion in 2022.
Among twelve months of 2023, RMG exports faced negative growths in 5 months and witnessed positive growths in other seven months, meaning the sector’s growth fluctuated frequently and left the year as turbulent for the sector.
Faruque Hassan said that, however, for the full year (2023) the growth has increased slightly amid the global apparel trade and the ongoing economic situation.
“We have done well. It could have been better if we had not faced domestic hurdles like gas shortage, electricity shortage, bond and customs related issues. But if we take the global market, inflation, turbulence etc into consideration we have done better than our competitors,” he added.
Bangladesh earned $55.56 billion in export earnings in FY23, posting a narrow 6.67% year-on-year growth. News Sources : Dhaka Tribune
