RMG export to US rises 11.74% in 2015 despite GSP suspension
Ibrahim Hossain Ovi
Bangladesh’s apparel export to US market has seen an 11.74% rise to $5.40 billion in the last calendar year, thanks to increased demand for clothing products.
The volume, however, posted a 16.3% growth in the same period that indicates the unit prices of apparel products made in Bangladesh has seen a fall.
In 2015, Bangladesh, the third largest exporter of clothing products to US, earned $5.40 billion, which was $4.83 billion in the previous year, according to the data recently released by OTEXA.
While export growth in terms of quantity rose by 16.30% to 2196.4 million square meters equivalent (SME), it was 1888.2million SME a year ago.
Meanwhile, the overall export to US market jumped to $5.60 billion with an 11.93% rise compared to $5 billion in the same period a year ago.
Export of non-apparel products also showed a robust growth by 17.44% to $200.63 million, which was $170.8 million a year ago.
After the suspension of GSP or Generalized System of Preferences, it was feared that export to the US market, the single largest export destination of Bangladeshi products, especially apparel items, will see a sharp decline, but resulted in better growth instead last year.
“Despite image crisis over safety issues and economic slowdown in the export destination, an 11.74% growth is a satisfactory one,” BGMEA senior Vice-President Faruque Hassan told the Dhaka Tribune.
But the 16.3% growth in terms of quantity means that the buyers have cut prices, a great concern for the sector people as the production cost has increased manifold due to safety upgradation, said Hassan.
Talking on the higher growth of volume, Hassan said the buyers cut unit prices as yarn price fell while the retailers took advantage of safety issues.
“We are urging the buyers to increase the prices but they do not pay heed.”
“After GSP suspension, it was apprehended that the export to US market will see fall, but it showed significant growth, Former finance adviser to the caretaker government AB Mirza Azizul Islam told the Dhaka Tribune.
The higher growth in quantity implies a fall in unit price, leading the manufacturers to negotiate with their buyers to increase unit prices, said Azizul.
The positive sign is that there is a huge demand for Bangladeshi RMG products in the US market as the volume posted substantial growth, he added.
According Otexa, in the last calendar year, the United States imported clothing products worth $85.16 billion from across the globe, of which Bangladesh’s share is 6.34% while China shares 35.86% and Vietnam 12.40% in terms of value.
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RMG export to US rises 11.74% in 2015 despite GSP suspension | Dhaka Tribune
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Exports cross $22bn in first eight months of fiscal year
Ibrahim Hossain Ovi
Bangladesh’s export earnings posted a nearly 9% growth to $22.12bn in the first eight months of the current fiscal year, according to Export Promotion Bureau data.
The provisional data showed that in the months from July the country earned $22.12bn from exports, which was 8.92% higher compared to $20.03bn a year ago.
Readymade garment sector, the major industry, was able to fetch $18.13bn during the period, making a 9.52% increase from $16.55bn one year earlier.
The woven sector exported products to receive $9.48bn and the knitwear products to get $8.64bn.
The data said in February the exports registered a 13.60% growth to $2.85bn from $2.51bn in the same month last year. The figure exceeded the target by 4.90%. The target was set at $2.72bn for the month.
In February, the apparel exports increased by 12.29%.
“The supply to the destination countries as per orders helped the country achieve the export growth,” said Shahidullah Azim, former BGMEA vice president, told the Dhaka Tribune.
He said the production capacity of the manufacturers had been increased while there were ample work orders from the retailers.
“However, the unit price fell which is a matter of concerns for the sector,” Azim said.
According to him, the apparel sector needed an 11% growth to reach $50bn export target by 2021. “We are going that way with 11.29% growth. If the trend continues, it is possible to reach the 2021 export target.”
The industry insiders said improvement of safety standards in the RMG sector and peaceful political situation and new markets were contributing to getting higher number of work orders from retailers.
“The inspection findings were good, that is beyond the expectation of the retailers and rights group,” said Abdus Salam Murshedy, president of Exporters Association of Bangladesh. “All these things have built a positive image [of the industry]. So the buyers now have more confidence on the Bangladeshi RMG industry’s environment.”
He stressed the need to complete remaining task of compliance in the industry so the image so far built could be saved.
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Exports cross $22bn in first eight months of fiscal year | Dhaka Tribune