RMG industry back on track after steep export decline08 May 2021
Kazi Zahidul Hasan :
Bangladesh's apparel industry is taking a turnaround from the coronavirus crisis, with exports rise by 6.24 per cent during the first ten months of FY 21, as factories swung into full gear to meet orders from global retailers.
Apparel exports have maintained a negative growth from October-February of this fiscal year and turned back to positive territory in March growing 8.81 per cent over the corresponding month of the previous year, according to the data compiled by Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
The data shows shipments of ready-made garments hit $2,516.98 million in April 2021, up from $374.67 million in April last year (2020).
Apparel shipment, which typically contributes 84 per cent to the national exports, collapsed 84.86 per cent in April and 50 per cent in May 2020 over the corresponding months in the previous year as global apparel buyers had either cancelled or put on hold existing orders amid the coronavirus pandemic.
"I think the worst is over for the industry and apparel export is bouncing back from unprecedented decline," BGMEA President Faruque Hassan told The New Nation on Friday.
He added, "Exports are doing well despite challenges caused by the ongoing pandemic. But, the next three months will be challenging for the industry on account of several internal and external factors."
The garment industry is the cornerstone of the economy in Bangladesh, and the country is the world's second largest exporter of the apparel products after China.
Faruque Hassan said, "The impact of
pandemic on apparel exports had been severe. Exports have turned back to positive territory after several months of negative growth. We hope the export of apparels will come to normal by October this year, taking advantage of reopening of European markets and better shipment performance in the US market."
"Despite the fact, factory owners are facing financial crisis as apparel export price dropped significantly. Currently, factory owners are running production even at losses with the hope that the business will bounce back in the coming days," said Faruque Hassan.
"They are taking orders lower than the production cost as at least they will be able to pay their workers and keep business afloat," he added.
When asked, Faruque Hassan said steps taken by the government are helping the sector to deal with the problems related to the Covid-19 pandemic. But industry owners need more state support to pay wages, Eid bonuses, and other allowances to their workers for April, May, and June.
"We have already requested the government to offer loans on similar terms as last year to help the export-oriented readymade garment industry," he said.
RMG sector fetched $26 billion from export proceeds during the July-April period of the fiscal year 2020-21.
Apparel exports declined by 18.45 per cent to $27.83 billion in the last fiscal year 2019-20 as the Covid-19 pandemic took a heavy toll on supply chain as well as global demand.