Most Sectors Barring The Readymade Garment (Rmg) Have Been Performing Poorly In Terms Of Export Earnings Since The Beginning Of The Current Fiscal Year (2013-14).

Most sectors barring the readymade garment (RMG) have been performing poorly in terms of export earnings since the beginning of the current fiscal year (2013-14).



The shortfall in revenue earning of these sectors, stretching from agricultural products to ship-building, was at least US$ 537 million during the July-March period as against the combined target of US$4.5 billion, official statistics at the Export Promotion Bureau (EPB) shows.



The share of these industries in the country's total exports is shrinking fast, officials of the Export Promotion Bureau told the FE late last week.Of all the 32 non-RMG sectors, only footwear, shrimp, rubber and leather performed relatively well during July-March period of the current fiscal.



The share of non-RMG sectors has shrunk to 19 per cent during the period under review against their usual share of around 30 per cent.Previously, non-RMG goods and products, had at times dominated the country's export sector in terms of growth.



Economists and industry insiders said restive politics during the October-December period last year and appreciation of the local currency, Taka, against the US dollar were the main reasons behind the fall of the share of non-RMG sectors in the total export earnings.



Ahsan H Mansur, executive director at the Policy Research Institute of Bangladesh (PRI) said the RMG sector being much organised one can overcome difficulties while the non-RMG sectors cannot.Until March last, the RMG sector fetched $18 billion out of $22 billion total shipment.



Mr. Mansur said domestic restive politics had caused problems for many fast growing export earning sectors like the bicycle exports to Europe.



"In my view, political situation that prevailed until December last affected our many fastest growing export earning sectors," Mr. Mansur said.



He said India bagged many non-RMG products following the weakening of its currency, Rupee.The export receipts from fast growing sectors like jute, home textile, specialised textile, plastic, vegetables and engineering fell significantly during July-March period.



Kaihan N Rahman, deputy managing director at Pubali Jute Mills Ltd., said export of jute goods fell substantially during July-March period as almost all its destinations were beset with either tension or political problems.



He said export to Syria and Egypt remained almost halted for long due to political problems there.He said weaker Indian currency made its products cheaper to the global buyers leading to fall in orders for Bangladesh-made goods.



He also said US sanctions on Iran had affected Bangladesh jute goods exports to the country significantly.According to the EPB, jute and jute goods sectors fetched only US$612 million against its target of $841 million for the period.



Md Nurul Islam, chairman of Noman Group, one of the key exporters of home textile products, said granting generalised system of preference (GSP) to Pakistan by the European Union (EU) affected export of Bangladesh-made products.



The EU granted GSP plus facilities to Pakistan until 2017 from January last. The GSP Plus status will allow almost 20 per cent of Pakistani exports to enter the EU market at zero tariff and 70 per cent at preferential rates.Mr. Islam said Pakistan is the reputed home textile producer in the global market and allowing GSP helped the country grab the market share fast.



Lt. Col. M Anisuzzaman, managing director of the Global Fabrics told the FE that appreciation of local currency against the US dollar was responsible for erosion in competitiveness of Bangladesh-made products."Bangladesh Taka appreciation made Indian products much cheaper and our many orders were diverted there," Mr. Anisuzzaman noted.



He said recent labour wage hike in the country has led to loss of efficiency in terms of prices."Our competitiveness lies with cheap labour as we import almost cent per cent raw materials for manufacturing terry towel products," he said. "We cannot compete when labour prices go up," he added.



Currently, Bangladesh has 70 terry towel plants and its export target for the July-March 2014 fiscal was at $62 million. But it could fetch $53 million, nearly 14 per cent less than that of target.

Source:- thefinancialexpress-bd.com