Garment exports down 12 percent

In the last or fourth quarter of the outgoing fiscal year, ready-made garment exports decreased by 11.92 percent compared to the previous or third quarter. However, overall export earnings increased. Behind the decline in export earnings in that quarter is the unrest caused by the imposition of additional duties on exports of goods from Bangladesh to the United States and the situation caused by the strike of National Board of Revenue employees. This has hampered export activities.

This information was obtained from a report published by the Central Bank on ready-made garment exports published on Thursday night. The report was prepared based on data up to last June. The Central Bank publishes this report every three months.

The report said that in the fourth quarter of the outgoing fiscal year, i.e. April-June, the country exported ready-made garments worth $9.11 billion. This export is 11.92 percent less than the previous quarter, i.e. January-March. The ready-made garment sector faced several serious problems in the last April-June quarter. These included the global economic recession and changes in trade policy. Which weakened the export efficiency of that quarter. One of the policy changes was the imposition of an additional tariff of 37 percent (later reduced to 20 percent) on Bangladeshi products in the US market. Although it was not effective until then, it increased uncertainty as foreign buyers suspended export orders.

The US administration revised the additional tariff rate on Bangladeshi products, along with many other countries, on July 31. This time, the additional tariff on Bangladeshi products was reduced to 20 percent. The additional tariff imposed from last Thursday came into effect. This puts Bangladesh in an advantageous position compared to competing countries. Because, Vietnam, Bangladesh's main competitor in ready-made garment exports in this market, has an additional tariff of 20 percent. On the other hand, the countervailing tariff on India has increased to 50 percent. And China's tariff is currently 30 percent.

According to the Bangladesh Bank report, the customs clearance process is delayed due to the strike of NBR officials and employees, which hinders the shipment process of products. It significantly disrupts the timely shipment of products. Meanwhile, exports are also hampered by adverse global economic conditions, domestic production costs and lack of diversification of export markets.

It also said that the value added in ready-made garment exports decreased slightly during the April-June period of the outgoing fiscal year. In this quarter, the country imported raw materials worth $3.94 billion against a total ready-made garment export of $9.11 billion. The value added stood at 56.78 percent. In the previous quarter, the value added was 58.90 percent.