RMG manufacturers are worried over the fall of product price and negative growth in major export destinations as it would hit the $50 billion export target by 2021.
Bangladesh has set the target, the driving force of which is the apparel industry, when the country will celebrate the golden jubilee of independence.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Md Siddiqur Rahman vented his feelings at an emergency press conference at his office in the capital yesterday.
The conference was held to brief reporters on the present status of RMG sector.
According to the BGMEA data in 2015, prices of clothing products in US saw a 3.81% fall which is 0.76% in EU countries
“The global economy is going through an unsteady situation. Bangladesh’s exports to major destinations see a decline. Currently, the sector witnesses an adverse situation at home and abroad,” said Siddiqur.
According to the BGMEA data in 2015, prices of clothing products in US saw a 3.81% fall which is 0.76% in EU countries.
In 2016, prices of Bangladeshi clothing products have seen over 1% fall in US market, while in the EU countries, it was 3.19%.
In the last two years, production cost went up by 17% due to gas crisis, devaluation of Euro and price fall in EU and US market, centering the US election and Brexit.
“As a result, we are losing competitiveness gradually in the global market,” said the BGMEA president.
Meanwhile, the apex trade body of the clothing industry urged the government to establish industrial zones near Dhaka and Chittagong on priority basis to relocate factories or allocate some Kashland (government property) to small RMG factories going through cash crunch.
Bangladeshi Taka has become stronger against the US dollar while Pakistan, Sri Lanka, India, Turkey and Vietnam have seen depreciation of their currencies.
“This made our competitors much stronger in the global market.”
Besides, the Indian government has announced package for its RMG industry, which would leave Bangladesh in tougher competition, said the BGMEA leader.
In July-December period of current fiscal year, Bangladesh’s export to US has seen a 9.11% decline to $2.56 billion, which was $2.81 billion while export earnings from the United Kingdom declined by 5.19% to $1.53 billion compared to $1.62 billion a year ago.
The BGMEA boss urged the central bank to increase private sector credit growth and increase private sector investment.
In its monetary policy, Bangladesh Bank set the private sector credit growth to 16.5% while in the last six months it achieved 15%, the highest in last three years.