After remaining subdued for a prolonged period on account of the Coronavirus pandemic, exports from Bangladesh seem to be on a rebound as earnings from merchandise exports surged as much as six times year-on-year to US $ 3.13 billion in April, thanks to a rebound in apparel shipment buoyed by the reopening of the economies in the US and Europe while the country’s export earnings in the July-April period of the current financial year 2020-21 grew by 8.74 per cent to US $ 32.07 billion from US $ 29.49 billion in the same period of the previous fiscal.
Even in the first 10 months of the current fiscal year (between July and April), earnings from garment shipment were up 6.24 per cent year-on-year to US $ 26 billion.
Of the sum, US $ 13.99 billion came from the shipment of knitwear items while US $ 12 billion came from woven items which fell by 2.71 per cent even as knitwear shipment registered 15.34 per cent year-on-year growth.
According to industry insiders, the shipment of knitwear items is increasing as people’s preference now is to spend more time indoors while on the other hand because of the pandemic, demand for woven garments like trousers, formal shirts, etc., have taken a hit as export of woven items, during most of the months in last one year, witnessed a decline of around 10 per cent. However, April saw the lowest decline during the period, which many feel, is an indication that the segment is rebounding, thanks to gradual reopening of stores and offices.
Speaking to the media, Faruque Hassan, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has reportedly maintained that global consumption of apparels has declined by more than 10 per cent over the last year because of the drastic fall in income of the people on account of the Coronavirus pandemic even as he underlined this has had an adverse effect on the prices of garment items as prices of apparel items took a sharp nosedive even if the cost of production has increased because of the higher prices of the raw materials and freight charges.
The BGMEA President has also reportedly expressed hopes that garment export might make a full recovery to the pre-pandemic levels by October this year as shipments are rebounding with the reopening of Western retail stores.
The trend of garment shipment is good with the rise in demand in the Western world, said Faruque, adding, “I hope the full recovery of exports from the garment sector will be by October this year…We are hopeful because majority of the people in the US have already completed the vaccination and the consumers have started going to the retail outlets which indicates that the economy is rolling on, …and thus the demand for consumer items, especially for garment items, is going up.” On the other hand, the European retailers and brands have started reopening stores while consumers are spending more, for which demand for ‘Made in Bangladesh’ garment items is also reportedly growing.
It is to be noted here that currently, the US is the single largest destination for Bangladesh’s garment export, with nearly US $ 6.5 billion worth of garment items being shipped in a year —
of all that is exported to the US, 90 per cent is garment items — while in case of the European Union, Bangladesh exports more than US $ 21 billion worth of garment items in a year, which amounts to 63 per cent of the country’s apparel shipments in a year.
Meanwhile, some recent reports even hinted that owing to Myanmar’s deepening political crisis and India’s Coronavirus situation, many international retailers and brands are diverting work orders to Bangladesh as well.
It may be mentioned here that mass protests have been taking place across Myanmar since the military seized control on 1st February and the elected leader Aung San Suu Kyi and members of her National League for Democracy party have been detained while in India, a devastating second COVID-19 wave has overwhelmed the country.
Apart from apparel, the leather industry of Bangladesh also seems to have benefited from the existing political crisis in Myanmar. The President of the Leathergoods and Footwear Manufacturers & Exporters Association of Bangladesh, Md Saiful Islam said the sector had been receiving an increasing number of work orders over the last couple of months.
Many leather and leather goods companies have shifted orders from Myanmar to Bangladesh because of the political uncertainty…The increase has significantly helped the recovery of Bangladesh’s leather and leather goods shipments recently, he added.
Meanwhile, speaking to the media, a European buyer in Bangladesh, on condition of anonymity reportedly maintained that it was true that work orders (apparel) are shifting to Bangladesh from Myanmar even as he reportedly also claimed that his company was not in favour of continuing business in a country governed by a military dictator, so for the political tension and on humanitarian grounds, it was relocating orders to other countries and would continue doing so in the long run.
He could not state the exact percentage of work orders that had shifted in favour of Bangladesh but underlined Bangladesh was receiving a substantial share of such contracts.
So going by the latest export figures and views and opinions expressed by the industry people, one may say that apparel export is on the rebound and it is just a matter of time before exports are back to normal again.