Bangladesh’s main driver of the economy, the apparel export’s contribution to the national exports, declined by 1.2% year-on-year to $10.45 billion in July to October of the current fiscal year.
According to data from the Export Promotion Bureau (EPB), Knitwear exports earned $5.80 billion, registering 4.76% year-on-year growth from July to October. While the export of woven products was down 7.76% to $4.64 billion.
Though the apparel export downturn recovered a bit after a historic decline of 18.12% in the seven consecutive months of this year, the readymade garment (RMG) export started to recover to some extent.
Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said, “amid yearlong downward trend, the shipments edged up to the positive terrain in August and September.”
She also highlighted that the 7.76% negative growth in October stresses the faltering recovery in global demand and trade. At the same time, the decline is mainly triggered by the drop in woven clothing export. And the July-September data demonstrations that export to non-traditional markets hurt the most, while delivery to the EU and the US continued steady growth and aided Bangladesh to turn around in exports.
The apparel industry leaders are concerned with a second wave brewing in the EU, and the US, as it will bring back stricter measures which can lead to a fall in demand.
The BGMEA leader stressed, “Since Europe has entered into a fresh wave of Covid-19 infection, lockdowns are being declared in many countries, including France, Germany, Belgium and Greece, it would be difficult for us to cope up if the EU’s demand for clothing and its sourcing is troubled further. This is worrying for us since Europe is our major market.”
There are multi-pronged challenges in the Bangladesh RMG as in October, the price of Bangladeshi made garments fell on average by 4.15% and the price growth in July to October was 3.45% negative.
Huq said, “Covid-19 has caused severe financial damages to our factories. The industry is running at a lower capacity by maintaining health protocol, which has certain costs, and the decline in prices at this point of time is killing us.”