Bangladesh has earned $4.85 billion through exports in January, registering a 41.13% year-on-year growth, according to data by the Export Promotion Bureau (EPB).
The export figure is slightly lower than the $4.90 billion earned last month. During the July-December period of the current fiscal year, export earnings had posted a 28.41% rise to $24.70 billion.
Total shipments in January saw a 30.34% YoY growth to $29.54 billion in the first seven months of the current 2021-22 fiscal year, up from $22.67 billion in the same period of FY21.
RMG exports grew 30.3% to $23.98 billion during the July-January period, of which $13.27 billion came from knitwear shipment, up 32.89% YoY, and $10.71 billion from woven exports, an increase of 27.23%.
Professor Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue (CPD), said that the export earnings from the RMG sector and other sectors such as engineering, agriculture, home textiles are increasing, which is a good sign for export diversification.
“Moreover, the export of knitwear is increasing, which is also a positive sign as there are a lot of opportunities to add domestic value in the knitwear sector. Domestic value addition is 60% in knitwear, which is about 45% in woven,” he added.
However, there are a few issues here, he pointed out, saying that the base of this growth rate is relatively low.
“Moreover, the export earnings are mainly volume-driven, not price-driven. Manufacturers increase exports to make up for losses triggered by the rising prices of intermediate goods or raw materials,” he added.
Rahman also said that last year, the price of yarn and cotton increased by about 51%. So, although the manufacturers export goods at large volumes, the profit margins are declining.
Bangladesh is receiving a good number of purchase orders due to the return of normalcy to the European and North American markets, he added.
“However, jute export growth has been consistently negative, though it is eco-friendly and biodegradable. It is important to find out the causes behind it,” said the economist.
Shahidullah Azim, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said they have to take necessary initiatives to sustain this trend of export growth.
“But the world has not yet recovered from the coronavirus. The spread of new variants could still hamper world trade. Coronavirus is still the biggest obstacle to our process of turning things around and moving forward,” he added.
He also said that while the order numbers are growing, infrastructural development is urgent to sustain it.
“Business-friendly government policies and improving ease of doing business will keep the industry afloat for years to come,” he added.
He also said that they need to further develop and modernize the existing trade infrastructure, including all seaports and airports for smoother trade, uninterrupted supply of gas, and so on.
Powered by Froala Editor