Bangladesh Exports Grow At 6.7% Y-o-Y Aided Largely By Garment Sales

Economy

Bangladesh Exports Grow At 6.7% Y-o-Y Aided Largely By Garment Sales

Data released by the central bank of Bangladesh indicated that the country’s export basket for November had expanded year-on-year by a robust 6.2 percent to tally at USD 3.06 billion. Garment exports were the main driving force behind this boost, the figures revealed.

From the perspective of the current financial year beginning in July, the initial five months of the 2017-18 season witnessed an export growth of 6.7 percent and the aggregate value of exports stood at USD 14.56 billion, according to data released by the Export Promotion Bureau.

In the RMG sector alone, the shipments that comprised knitwear and woven items amounted for a robust USD 11.96 billion in the first five months of the current financial year. This worked out to be a growth figure of 7.5 percent on a Y-o-Y comparison basis.

This comes in as a healthy sign as Bangladesh relies heavily on garment exports for earning foreign exchange. It has managed to stay competitive mainly because of low wages coupled with duty-free access to markets in the European Union (EU) and the US. In fact, though, it’s a poor second, it remains the world’s second largest exporter of apparel next to China.

According to government documents, the target set for the year 2017-18 stood at USD 37.5 billion. The lion’s share of this pie has come from the garment exports with a tally off USD 30.16 billion. A Bangladesh Garment Manufacturers and Exporters Association (BGMEA) spokesman said “We are well on track to achieve the set target.”

A veteran exporter reaffirmed the view stating that the inflow of orders was showing a very healthy sign. “We can safely assume that our targets will be met provided the current trend persists. With the current set of reforms in place, our buyers are only too happy with us. There is no scope for complaining," he added.

His statement came in wake of the controversy that was raised by buyers when a factory building had collapsed resulting in the death of more than 1000 people some few years ago. Concerns had been raised by the foreign buyers about the safety standards being followed by the Bangladesh garment manufacturers. Ever since, the Bangladesh government went into the repair mode and succeeded to a large extent in controlling the damage to its image.

Compared the previous financial year’s Y-o-Y growth the current financial hear is much healthier. The garment exporters attributed the poor 1.7 percent growth in the previous financial year, which incidentally was the lowest in 15 years, mainly to global markets registering a sluggish demand phase.

Currency issues also figured in the poor tally of the previous year. “A weak Euro coupled with appreciation of the Bangladeshi Taka against the US dollar also contributed to the low growth figures,” said an exporter.