DHAKA: The country’s export earnings posted a 3.35% growth in the just concluded fiscal year, which is the lowest in last 13 years.
Back-to-back political unrest in the last two years, economic slowdown in the export destination countries and devaluation of Euro against dollar are attributed to the fall of export growth.
According to the provisional data of Export Promotion Bureau (EPB), Bangladesh earned $31.19bn in the financial year 2014-15, which is 3.35% higher compared to $30.18bn in FY2013-14.
Bangladesh set an export target of $33.2bn for the last fiscal year, but it failed to reach the target by around 6%. It earned $31.19bn.
Trade analysts and manufacturers identified external and internal reasons for slow export growth.
Political unrest has been named as domestic problem while global economic recession and fluctuation of demand and exchange rate external.
“The back-to-back political unrest in the last two years and industrial accident cast shadow on export earnings as it hindered production at factories and delayed shipments,” Exporters Association of Bangladesh (EAB) President Abdus Salam Murshedy told media.
Due to violent political programme in the first part of the year, manufacturers especially in the RMG sector failed to attract buyers to capture orders, said Salam.
The exchange rate, particularly the devaluation of Euro against dollar, might have impacted the export earnings, he added.
If the budget is implemented and business people are entertained with gas and electricity connections to establish new factories, the situation can be overcome, he added.
“Fluctuation of demand for clothing products in exporting destinations due to economic slowdown, and fluctuation of exchange rate, which lowers competitiveness acted as the external factors for slow growth of export earning,” Khondaker Golam Moazzem, additional research director of the Centre for Policy Dialogue said.
While competitors like Pakistan are doing better in the EU countries because of GSP, plus trade facility, he said.
On the other hand, the buyers might have placed less orders to Bangladesh due to lack of sufficient progress in compliance issues, and also due to political unrest, said Moazzem.
He expressed doubt about reaching the export target of $50bn by 2021 if the present situation prevails in the country.
To overcome the situation, all stakeholders have to be strategic to ensure better compliance and send a good message to the global buyers, he suggested.
“The compliance issue that led to the rise of production cost and the implementation of new wage structure also acted as a catalyst for the slowdown of export earning,” BGMEA President Atiqul Islam told media.
He explained why RMG orders are shifting to another country.
It will take 10 years to rebuild image that had been tarnished in the 92-day political unrest in the first part of the year, Atiqul said.
Trade analysts and sector people put emphasis on the increase of productivity to deal with the production cost and to remain competitive in the global market.
They urged the government to pave the way for setting up of new business to tame unemployment.
A good number of factories have been shut due to compliance issues that dented production and rendered workers jobless, said Salam.
Talking to the Dhaka Tribune, EPB Vice-Chairman Subhashish Bose also blamed external and internal factors for the slow export growth.
