The country’s export earnings have increased in July due to shipment of cancelled orders and rejection of China goods by Western customers for US-China conflict, experts said.
Expressing concern over the continuation of the growth, they also said that the country has to do more in the Covid-19 period and it will take time to bring normalcy in the export sector.
Bangladesh needs to increase bargaining capacity to fix prices of the products by maintaining standard quality of the goods.
Dr Zahid Hussain, former lead economist of The World Bank, told The New Nation, “Bangladesh witnessed increase in export earnings in July. It is mainly due to shipment of cancelled orders and switching to produce safety equipment goods to meet global demands during the pandemic period.”
“The country mainly exports basic apparel items in Europe and the US. But the pandemic has failed to dampen the demand for the items in the Western countries due to their government assistance during the time,” he said.
Besides, rejection of Chinese goods by the consumers of the Western countries due to US-China conflict is another reason behind the export earnings growth as many brands are moving out from China, he added.
He further said the country will have to set up international standard testing lab to ensure quality of the products as soon as possible to increases bargaining capacity and to further expansion of the global markets of the Bangladeshi goods.
Continuing the export growth, Dr Ahsan H Monsur,
Executive Director of Policy Research Institute, said, “Bangladesh should emphasise on other prospective sectors like jute goods, agricultural products and IT sector.
He further said that the 292 non-RMG products (at HS-6 digit), more than $1 million each that we exported in FY2019 and 40 per cent of them were highly competitive with other exporting countries to the same destination markets.
But, except for jute and jute goods, footwear and leather goods, and home textiles, there are hardly any other products showing promise of rapid growth, he added.
Bangladesh earned $3.24 billion from apparel shipment though the amount is 1.98 per cent lower than a year earlier. Garment export receipts in July are 14.18 per cent higher than the monthly target of $2.84 billion.
Of the total garment shipment, knitwear exports grew 4.30 per cent year-on-year to $1.75 billion while woven exports fell 8.43 per cent to $1.49 billion, according to data from the Export Promotion Bureau. In the wake of Covid-19 spreading in Europe and the US, global trade descended into a free-fall, earnings from apparel shipment in April, May and June stood at $0.37 billion, $1.23 billion and $2.28 billion respectively.
Personal Protective Equipment (PPE), masks and other hospital textiles made it to the list of new export items for Bangladesh as a good number of buyers are placing work orders for these items amid the coronavirus pandemic.
Following the demand, as some 33 readymade garments manufacturers adapted to the changed situation quickly by switching to medical wear production.
They started to make high quality PPE suits, masks, aprons, patient scrubs, disposable gowns, caps, shoe covers, hospital bed sheets, pillow covers and curtains.
But the country has not any Harmonised System (HS) code for locally produced coronavirus safety products, let alone manufacturing and exporting them on a larger commercial scale.
“It’s too early to make a positive remark on the inflow of new orders since many factories are still struggling to survive due to financial hardships,” said Md Faisal Samad, Senior Vice-President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
“New orders are coming but at a slow pace and we will also need to see at what price levels these new orders are being placed,” he added.
