POST TIME: 13 November, 2019 12:59:16 AM
Export slump continues amid global trade uncertainty

Export slump continues amid global trade uncertainty

The country’s export earnings have continued to slump as the major economies of the world are facing recession amid the US-China trade war, reducing the buying aspirations of consumers, say experts.

Consumers around the world are spending less on almost everything, which is being reflected in the poor work order placed by renowned brands. Though the global market size of apparel exports is USD 600 billion, the total value of exports was only USD 440 billion last year, the experts add.

Export earnings in October of FY2019–20 fell by 17.19 per cent to USD 3.07 billion from USD 3.71 billion in the same month of the last fiscal year due to a worldwide sluggish demand and lower shipments of apparel items, say industry insiders.    

According to the Export Promotion Bureau, export earnings from the RMG sector in the first four months (July–October) of FY2019–20 fetched USD 10.57 billion, decreasing by 6.67 per cent to USD 11.33 billion compared to the same period of FY 2018–19.

"Europe is the pivotal export market for our RMG products, but it has lowered its imports from us since last year. The world market value of exports is worth USD 600 billion, but last year it was only USD 440 billion—this means exports diminished worldwide, The world market condition is bad," said Siddiqur Rahman, former president of the Bangladesh Garment Manufacturers' and Exporters' Association (BGMEA).

The de-growth in exports was a reflection of sluggish global demand and a rising tariff war between China and the US. Global consumers are currently spending less on almost everything, Dr Khondaker Golam Moazzem, research director of the Centre for Policy Dialogue (CPD), told The Independent.  

The consumers have already cut back on clothing and entertainment in the past year, he elaborated. “The demand for diversified products is increasing worldwide. But we have failed to diversify our products and are reliant only on the apparel sector,” he added.

Talking to The Independent, Siddiqur Rahman said that export growth had slumped as the local currency had become stronger vis-a-vis the US dollar in the last couple of months.

Rahman also said businessmen were asking for a devaluation of the taka as competing countries have depreciated their currencies to give their exporters an advantage. He further said that the online apparel market was growing, affecting the export growth.

 products earned USD 5.03 billion in the July–October period of this fiscal year (2019–20), marking a 7.67 per cent negative growth from the same period in the previous fiscal year. The knitwear industry earned around USD 5.53 billion during the same time, up by 5.73 per cent from USD 5.87 billion the same period last year.

According to the EPB, during the first three months (July-October) of FY 2019–20, exports of agricultural commodities, such as tea, vegetables, and tobacco, registered a negative growth of 2.46 per cent and fetched USD357.5 million.

EPB officials said that the export of leather and leather products also had a sluggish growth, with the sector registering a negative growth rate of 8.2 per cent.

EPB data shows that the growth rate of jute and jute goods exports have bounced back, reaching 8.88 per cent. This sector earned USD314.49 million in FY2019-20 (July-October) compared to USD 288.85 million in FY2018-19 (July-October).       

Industry experts said that India had slapped anti-dumping duty on jute sack cloth from Bangladesh, triggered by a spike in its imports following the imposition of similar duty on sacks and products in 2017.

EPB data shows that the growth of furniture exports has also decreased, registering a negative growth of 0.30 per cent. This sector earned USD 22.98 million in FY 2019-20 (July-October).