Alarming fall in export

EAB seeks urgent govt step

News Report Country's export business is now facing a challenge due to second wave of recession in the western countries and high price of oil, gas, electricity and dollar. Country's top export sector, ready-made garments sector (RMG), witnessed a 42 per cent export growth in 2010-2011 fiscal year withstanding recession in the main export markets - US and the EU countries. The sector witnessed 21 per cent export growth in the first four months of the current fiscal. In the month of November, the sector's export earnings fell by 16.95 per cent against the target and growth rate was mere 2.4 per cent, indicating a frustrating situation. Export orders and the price of the exportable items have also lowered. Fall in exports has put a negative impact on country's foreign exchange reserves. The frequent price hike in energy and power has caused rise in the production cost of the exportable items on one hand and the international prices of the items have declined on the other due to fall in demand. The export-oriented industries of Bangladesh are dependent on foreign countries for their capital machineries and raw materials. The industries import their raw materials with high

cost as local currency taka has lost its value by 16 per cent over the last one year against the US currency dollar. High cost of raw materials like cotton, fabrics and other accessories has also contributed to the high production cost of RMG products, creating a challenge for the exporters to keep up their competitive edge. "Earnings from export-oriented industries have declined alarmingly. The overall export sector is struggling and the exporters' huge loss has caused a great concern for us," President of Exporters' Association of Bangladesh (EAB) Abdus Salam Murshedy told The News Today on Tuesday. Not only the country's number one export sector RMG - is incurring losses but other export sectors especially the jute, fish, plastic, leather and pharmaceutical sectors are facing a great challenge. The export of raw-jute and jute products has fallen drastically in the recent months. High rate of interest, labour cost, exorbitant prices of power and energy, inadequate supply of gas and power, and nagging infrastructural problems have created a gloomy situation for the country's overall export sector. Murshedy said, Bangladesh now the world's second largest apparel exporter. The RMG sector fetched $18 billion in fiscal 2010-11, contributing more than 78 per cent of overall exports. "We have survived the 2008 global crisis, with the help of garment products. The sector withstood global recession and witnessed 42 per cent growth in fiscal 2010-11. But

second time recession in the debt-laden EU countries will hurt the export to the Eurozone, the largest destination for Bangladesh apparels. We aim to achieve exports above targets, beating all the crises, exploring new destinations but we need policy support from the government, Murshedy said. He said, export growth depends on adequate supply of gas and power, skilled manpower, efficient ports, customs and good infrastructure. Frequent hikes in power and energy prices, high transport cost, traffic snarl, worker's unrest, high interest rate and soaring inflation will hit the export sector hard. The EAB has demanded of the government to withdraw the enforced tariff hike in gas, power, fuel from the export-oriented industries, give subsidy and incentives to cope with the adverse situation. The EAB president has also urged the government to take pragmatic steps immediately to save the export sector.