Welcome to Business Outlook
Related Articles
The Bangladesh Garment Manufacturers and Exporters Association feared that the country’s readymade garment exports in the March-May period of this year would fall nearly $5 billion short of the regular figure due to the coronavirus outbreak across the world.
The trade body also projected that the fall in exports would result in unsettled liabilities of back-to-back letters of credit worth $1.96 billion.
Based on the Export Promotion Bureau data for March and the National Board of Revenue data for seven days in April, the BGMEA estimated that the RMG exports in March-May this year would decrease by 56.93 per cent to $3.70 billion from $8.60 billion in the same period of last year.
The data showed that the RMG exports in March, 2020 declined by 30.19 per cent to $1.97 billion from $2.82 billion in the same month of 2019.
The NBR data showed that the RMG exports in the first seven days of April declined by 77.76 per cent to $129.40 million from $581.93 million in the same period of last year.
Taking the data into consideration, the BGMEA estimated that the exports in the month of April might dropped by 70 per cent.
‘Given the fact that Eid-ul-Fitr vacation will start after May 20, we have 20 days in hand. Since it takes at least three weeks to produce goods, there will be almost no goods ready for shipment. We can still assume the trend of April to follow in the month of May.’ BGMEA president Rubana Huq said.
As per the BGMEA projection, the RMG exports in April this year would decline to $761.78 million from $2.54 billion in the same month of 2019.
It showed that the RMG exports in May this year might decrease to $972.95 million from $3.24 billion in the same month of last year.
Rubana said that the RMG exports in three months (March-May) might fall around $4.9 billion short of the regular export figure and the amount of resulting unsettled liabilities would be $1.96 billion.
According to the BGMEA data, RMG export orders worth $3.15 billion were cancelled or held up by the global buyers in 1,134 factories till April 12.
‘Global buyers and brands have cancelled or kept hold their orders as the sales of RMG products came to almost zero due to the coronavirus pandemic,’ Centre for Policy Dialogue research director Khondoker Golam Moazzem told New Age on Sunday.
He said that the fall in exports would hit not only the RMG business but also put a negative impact on the growth of overall economy and employment.
Moazzem said that the government had announced incentives for the industrial sectors including the RMG and the entrepreneurs would have to use the incentives efficiently to overcome the coronavirus fallout.
(NA)
