Bangladesh is unlikely to reach its export target set for the current fiscal year in the wake of the prevailing political unrest that has already undertaken heavy toll on the country’s economy.
The government has set US$33.2bn export target for the fiscal year 2014-15 to earn $27.5bn from the nation’s potential garment sector. The target is 8.85% higher than that of the last year’s earning of $30.19bn.
According to Export Promotion Bureau (EPB), in the first half of the current fiscal year, Bangladesh earned $14.9bn, which is 4.42% less than that of the export target of $15.6bn for the period.
On the other hand, the export growth had showed a slower trend to 1.56% in July-December period, the lowest in the last five year.
In the first half of the current fiscal year, Bangladesh has witnessed over 1.5% growth against the target of around 10%, former finance adviser to a care taker government ABM Mirza Azizul Islam told the Dhaka Tribune.
“If we want to meet the target, we have to achieve over 15% growth in next six month, which is not possible due to the ongoing political unrest as it has already disrupted both the supply and the demand sides,” said Islam.
In this regard, he also reminded that the buyers were unwilling to place orders in Bangladesh amid political unrest.
“The export target for the FY2014-15 is under great threat due to the ongoing political turmoil since January 5 and if the present situation does not improve, it will be quite impossible to meet the target,’’ Mohammad Hatem, former first vice president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told the Dhaka Tribune.
A confirmed order worth $3.8m has finally been withdrawn as the buyer is not willing to take any risk placing orders in Bangladesh under the current state of political unrest, he added.
If there is not enough work orders for the export-oriented industry, especially the apparel industry, how come it would be possible for us to ship the products under police escort? questioned an exporter, commenting on the government’s initiative to keep the supply and delivery chain smooth at any cost.
The country’s supply chain has been shattered since 5 January and if it continues any further, production at the export oriented factories will come to a halt, he added.
After the X-mas, it is the high time for the buyers to place orders but they are placing at least 30% to 40% less orders due to the political unrest, he further said.
As there is no sufficient orders, a good number of factory owners is running their factories partly, said BGMEA Vice President Shahidullah Azim.
“It would be quite impossible to reach the export target by any means under the current situation and consequently, it would badly hit the export target of $50bn by 2021,” he added.
According to Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the RMG sector has lost more than 30% orders as the buyers are not even coming to Bangladesh to place their orders.
Bangladesh mainly depends on garment, leather, agricultural products, shrimp and jute and jute goods to achieve its export target.
Among the major export sectors, Knitwear sector failed to reach the target by 2.41% followed by Woven 7.27%, leather and leather products 12.80%, home textile 7.19%, specialised textile 12%, frozen fish 10.47% while vegetable 26%.
