Shah Alam Nur :
Bangladeshi manufacturers are seeing bright prospects for the leather sector after the readymade garment (RMG) industry as China, the world’s largest footwear manufacturer, is shifting focus away from this segment.
The manufacturers believe that Bangladesh’s annual $550-million footwear industry may grow to a $15 billion sector within a few years, if the opportunity is seized.
“At least 51 foreign companies have already expressed their interests in establishing joint-venture footwear units in Bangladesh,” Leather Goods and Footwear Manufacturers and Exporters Association (LGFMEA) President Syed Nasim Manjur told The New Nation on Sunday.
He said, “China, the world’s largest footwear manufacturer, is now withdrawing from the global market. And our country is ready with huge potentials to attract foreign investments in the sector.”
Nasim Manjur, also Managing Director of Apex Footwear Ltd, said the country’s leather sector can beat the RMG, the largest forex earner, ‘if their starting times are taken into consideration’.
He said China, Vietnam and Brazil, three big manufacturers of leather footwear, are cutting down on this sector.
“That’s why I think the leather industry is the most prospective sector after readymade garments for attracting foreign investments,” he added.
Leather sector businessmen said foreign entrepreneurs are interested in Bangladesh’s footwear, thanks to the availability of rawhide, processing infrastructure, low labour cost, and a slew of government incentives, including duty-free machinery imports.
According to the LGFMEA, 110 export-oriented factories manufacture footwear in the country.
Of them, Apex, FB, Picard Bangladesh, Jenny’s, Akij, RMM Bengal and Bay have their own tanneries and leather processing units.
There are another 207 leather-processing units in the country.
According to the Export Promotion Bureau (EPB), Bangladesh earned a total of $663 million from exports of leather, leather goods and footwear in first seven month of current fiscal, while its earnings from only footwear stood at $297 during the period.
The amount accounts for 4.2 per cent of the country’s total exports.
Asked about the reasons for China’s focus shift, Bangladesh Footwear and Footwear Accessories Association General Secretary Humayun Kabir said labour cost there had gone up.
He said footwear exports would grow if duties on import of shoe materials are cut.
Though the government has no specific information about the local footwear demand, the sector estimates it to be anywhere between 200 and 250 million pairs a year. The local products met 92-95 per cent of the domestic demand, insiders said.
Orion Footwear Chief Executive Officer Ruhul Amin Molla said Bangladesh’s footwear sector is poised for a big expansion.
Until 1990, Bangladesh used to export mainly rawhide, wet blue leather, and crust leather. But now it is concentrating on exporting finished leather and leather goods.
Bangladesh Hide and Skin Merchant Association President Md Ali Hossain said the country annually produces 200-300 million square feet of finished leather, most of which is exported.
He said Bangladeshi leather is the best in the world after the French product.
Stakeholders believe the country’s leather industry would see greater potentials once the tanneries are shifted from Dhaka’s Hazaribagh to Savar’s new leather industrial complex.
