Bangladesh's merchandise exports grew by 3.8% year-on-year to $4.78 billion in August, driven by an acceleration in the shipment of apparel items valued at $4.04b, as per government data.
The apparel exports saw a 7.98% year-on-year growth to $4.04b in August. Of which, knitwear contributed $2.31 billion and woven contributed $1.72 billion, according to provisional data released by the Export Promotion Bureau (EPB) on Monday.
This growth will help the country minimise its ongoing foreign exchange crisis. The country's overall forex reserve stood at $23.06 billion on 30 August and is projected to slip below the $23 billion mark this week after a $1.20 billion payment to the Asian Clearing Union (ACU) for imports.
A day earlier, the Bangladesh Bank reported an 18.78% decline in inward remittances in August compared to the previous month, marking the lowest inflow in the past six months.
The EPB data shows that the garment sector was the major contributor to the overall export earnings in August.
Apart from the apparel sector, some sectors such as the home textile, leather and leather products jute and jute goods exports experienced negative growth.
The country's merchandise exports grew by 9.12% year-on-year to $9.37 billion in the first two months (July-August) of the current fiscal year.
The apparel industry fetched $7.99 billion in two months ending on August 31 this year, up from $7.11 billion in the same period a year ago, according to the EPB data.
The export of knitwear was $4.58 billion and woven was $3.42 billion, marking a 17.02% and 6.86% year-on-year growth, respectively.
Shovon Islam, managing director of Sparrow Group — one of the pioneers in garments manufacturing in Bangladesh, told The Business Standard, "It is very good news for the apparel sector because many factory owners reported having low orders amid the global economic slowdown."
He also mentioned that in the coming months, Bangladesh may enjoy a batch of fresh orders from global buyers due to two main reasons — most of the brands have cleared their inventory and inflations are coming down in Western countries.
Referring to his visit to the USA last week, the Sparrow Group managing director said, "Most apparel brands have cleared their inventory and are now placing new orders. At the same time, Vietnam and China are facing a slight downward trend in apparel manufacturing and a portion of their orders is also coming to Bangladesh."
Besides, inflation is going down in our major markets. In the USA, inflation is now about 2.2% and EU inflation is now about 5-6%. Hence, the next spring and summer orders will be 10% higher, Shovon said, expressing hope that the next season will be a good season for Bangladeshi apparel exporters.
Echoing the same, BGMEA President Faruque Hassan said the near 8% growth is very positive in such an economic situation. Although apparel exports to two major markets — the USA and Germany — are still in the negative.
"Disruption in the supply of electricity and gas, the dollar shortage and customs services remain big challenges for apparel exporters. Despite these challenges, the apparel exporters contributed about 85% to the overall export earnings. Other sectors could not perform that well," the BGMEA president added.
How other sectors performed
Among other sectors, agriculture products, leather and leather products, home textiles, and engineering products registered negative growth in August, the second month of the current fiscal year.
EPB data shows, the shipments of agriculture products declined by 9.44% year-on-year to $101.91 million in August. The sector's earnings were $112.53 million in the same month of last fiscal.
Home textile exports faced challenges. Insiders attributed the decline in home textile exports to reduced demand for the products in the post-Covid era.
Home textile exports experienced over 60% negative growth to stand at $68.31 million in August, which was $172.57 million in the same period of last year.
Once billion-dollar-earner jute and jute goods sector, which used to be called "golden fibre", experienced a 19.32% negative growth to $74.79 million worth of exports.
Leather and leather products exports fell by 22.40% year-on-year to $96.08 million. The sector's earnings were $123.82 million in the same month of last fiscal.