BD exports hit record $22.9bn on apparel sales

Clothes exports climbed 43 percent to more than $17.9 billion, Export Promotion Bureau data showed on Tuesday.

Bangladesh's low labour costs have helped it join the global supply chain for low-end textiles and clothing.

Officials have said the record exports reflected the decision by some retail chains such as European-focused Esprit Holdings to shift production to Bangladesh from China, where labour costs are rising.

Bangladesh's total exports surged 41.5 percent during July-June, exceeding the target of $18.5 billion. The June total, $2.38 billion, was the highest ever monthly export figure.

Mohammad Shafiul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association, attributed the strong numbers in 2010-11 to a shift in orders from China, January's relaxation in import rules by the European Union and the global economic recovery.

The Export Promotion Bureau unveiled on Tuesday its export target for the current fiscal year, which began on July 1, at $26.3 billion, up 15 percent from 2010-11, a slower pace of growth than the 41.5 percent last year.

"We have fixed the target considering signs of global economic slowdown in the key western world," Jalal Ahmed, head of the Export Promotion Bureau.

"We anticipate a slowdown in exports growth after massive growth in previous fiscal year," Ahmed said.

The projected 2011-12 export target for garments is $20.29 billion.

Shafiul also said the outlook was not so buoyant, adding that July-September will be slower than a year ago as orders from buyers in Western economies were declining.

"Quick recovery of economies in the Western countries would be a key driver for Bangladesh's exports," he added.

Also affecting the outlook for Bangladesh's exports at present are a power and gas crisis, high interest rates and a volatile political situation.

A series of anti-government strikes in recent weeks over issues ranging from a constitutional amendment to an exploration pact with US energy giant ConocoPhillips had crippled much of the country's economic activities, which exporters said could cost millions of dollars in losses.

The garments sector, which employs 3.5 million workers, is one of the main foreign exchange earners for Bangladesh's more than $100 billion economy, along with remittances, which have recently seen slower growth mainly due to turmoil in the key Middle eastern and north African countries.

Remittances from more than 7 million Bangladeshi working abroad and a robust garments sector played key roles in lifting nearly 14 million people out of poverty over the five years to 2010.

Bangladesh is grappling with high inflation and swelling trade deficits, driven by costly fuel and oil imports, which analysts said could jeopardise economic growth.

Copyright Reuters, 2011