The country’s export earnings fell by 7.59 per cent or $1.3 billion year-on-year in five months (July-November) of the current fiscal year 2019-20 with the earnings plunging for the fourth consecutive month in November.
Exporters and economists said that a declining business competiveness especially that of the readymade garment sector and flagging global economy kept taking toll on Bangladesh export shipments in November with earnings falling by 10.70 per cent in the month.
Export Promotion Bureau data released on Thursday showed the country’s export earnings in July-November of FY20 fell to $15.77 billion from $17.07 billion in the same period of FY19.
Export earnings in November of FY20 declined to $3.05 billion from $3.42 billion in the same month of FY19.
The earnings fell by 11.49 per cent in August, 7.30 per cent in September and 17.19 per cent in October of FY20.
Export earnings in the five months of FY20 fell 12.59 per cent short of the government-set target of $18.05 billion for the period.
Exporters and economists said that both the prices and the consumption of readymade garments slumped globally due to the ongoing economic woes.
At the same time Bangladesh is losing its competitiveness in the global market due to its overvalued currency and increasing cost of doing business, they said.
‘Global economy has been facing a recession warning situation and the European Union is now the weakest market in the globe in terms of economic growth. Bangladesh depends largely on the EU market and the country’s export earnings growth is intertwined with the EU economic growth,’ Policy Research Institute executive director Ahsan H Mansur told New Age on Thursday.
He said that Bangladesh was lagging behind competitors like Vietnam due to its overvalued currency.
Mansur said that Bangladesh was also losing its competitiveness due to increasing cost of doing business, fall in prices of products in the global market and long lead time for shipments.
The EPB data showed that the earnings from the RMG exports in July-November of FY20 fell by 7.74 per cent to $13.09 billion from $14.18 billion in the same period of FY19.
According to the EPB data, the export earnings from woven garments fell by 8.74 per cent to $6.28 billion in July-November of FY20 from $6.88 billion in the same period of the last fiscal year.
Earnings from knitwear export in the five months decreased by 6.79 per cent to $6.80 billion from $7.30 billion in the same period of last fiscal year.
‘The EPB data spots another dent in the export growth curve. Such continuing negative growth (for four months in a row) last happened in the March-June period of FY12,’ said Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association.
She said such decline testified that the competitiveness of the RMG industry in Bangladesh was really in danger and the country was not aligned at all with the global competitive scenario; particularly the exchange rate movement of the taka against the competing currencies remained inconsistent.
Rubana also said that shutting down of factories in recent months especially after the minimum wage hike in December last year was taking its toll on the export industry.
‘The latest data from the official source of the US and the EU show that Bangladesh is significantly lagging behind our competitors in terms of growth during the third quarter of 2019, i.e. July-September 2019. During this period Bangladesh registered 1.70 per cent growth in the US whereas Vietnam grew by 14.23 per cent, India 3.93 per cent, Cambodia 15.56 per cent and Pakistan 6.58 per cent,’ she said.
The picture in Europe was not much different as Bangladesh had seen only 0.90 per cent growth during the quarter, whereas the growth of Turkey was 2.98 per cent, Vietnam 2.88 per cent and Sri Lanka 6.17 per cent, the BGMEA president said.
Rubana urged the government to set the exchange rate premium on the local retention of the RMG export and untangling the complexities in cash incentive.
The export earnings from leather and leather goods in July-November of FY20 fell by 10.03 per cent to $391.09 million from $434.7 million in the same period of last fiscal year.
Export earnings from leather-footwear in the five months of FY20 fell by 12.91 per cent to $230.16 million while other leather products fetched $104.63 million with an 11.10-per cent growth in the period.
The export earnings from jute and jute goods in July-November of FY20 grew by 15.16 per cent to $404.79 million from $351.50 million in the same period of FY19.
Export earnings from home textile in the five-month of FY20 declined by 12.34 per cent to $298.65 million from $340.70 million in the same period of FY19.
The export earnings from agricultural products in the five months of FY20 fell by 2.69 per cent to $446.32 million from $446.32 million in the same period of FY19.
The frozen and live fish export revenue decreased by 7.62 per cent to $235.11 million while the earnings from shrimp export fell by 5.70 per cent to $178.67 million in the five months of FY20.
Export of engineering products in the five months of FY20 fell by 1.80 per cent to $142.37 million from $144.98 million in the same period of last fiscal year.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Trade & Commerce