Garments eye $18b export by 2010 as China struggles with strong Yuan
Manufacturers eye an 18 billion dollars of garment exports in 2010, as strong Chinese and Indian currencies have hit their exports hard, while a weak Taka make Bangladeshi items the cheapest in the world, officials said.
Their comments came as the Export Promotion Bureau said Saturday the country's exports grew 51 per cent in January year-on-year, on the back of 'stunning' performance by readymade garments.
The country exported goods over 1.23 billion dollars, which is at least 51 per cent more than figure of last January, with garments accounting for over three-fourths of the tally.
The performance pushed the seven months export growth to 9.78 per cent to a total 7.73 billion dollars.
"It's a very good come-back for our garments industry. And trends of February and March show that the growth would remain robust this year," head of government's export promotion bureau Shahab Ullah said.
Knitted items such as T-shirts, pullover led the growth with 69 per cent increase and and the woven garment items such as trousers soared by 49 per cent.
"We had some bad time in July-September. But we gradually picked up steam since then," the EPB chief said.
The country's export was in the negative territory in the first five months of the fiscal year beginning from July due to the continued fallout of labour unrest and political turmoil since late 2006.
In December garments showed first signs of major recovery, pushing the six months growth to positive territory of three per cent to 4.9 billion dollars.
Exporters said the January growth showed the impact of the 2006-7 turmoil is over and Bangladesh making rapid strides to emerge as the most serious challenger to China.
"We have proved what we are capable of. We beat China both in prices and quality in some categories," Bangladesh Garments Manufacturers and Exporters Association (BGMEA) chief Anwarul Alam Chowdhury Parvez said.
He said garment exports would fetch at least 11 billion dollars this year, as most of the factories have been swamped with orders.
Statistics released by the US commerce department shows that Bangladeshi made knitted cotton trouser, a major export item, beat China in volumes for the first time in history.
"If the political stability remains and there is no fresh major labour troubles, we will export 14 billion dollars next year and over 18 billion by 2010," he added.
The country's exporters have already expanded their facilities to cope with orders over 15 billion dollars, but could not utilise the capacity last year because of the political and labour troubles.
According to the BGMEA, despite the turmoil, the country imported 104,000 units textile and garments machinery last year, which is three times the figure of 2003.
Fazlul Haq, the leader of knitwear manufacturers association, said the appreciation of Chinese Yuan and Indian Rupee has played a key role in making Bangladeshi-made garments the darling to international buyers.
"There is hardly anyone who can compete us in price. Factories in China and India have become sick because of their appreciating currencies. They can no longer compete with us," he said.
Chinese Yuan appreciated seven per cent against US dollar last year and three per cent in the first two months this year. Indian Rupees have gained over 11 per cent against dollar in 2007.
In contrast, Taka has appreciated less than one per cent against the ailing US dollar since July last year.
The Wall Street Journal in a recent report said thousands of garment factories in China's coastal belt have closed their shutters due to the appreciating Yuan and wage pressure.
"The buyers now see Bangladesh the best destination to do shopping as the hangover of last year's turmoil is over.
"Price aside, our products have become superior in quality and Chittagong Port the most efficient in its history," he said.
"In addition, industrial expansion is going on unabated, with one factory being set up in every two days," Haq said.
Garments export sales fetched 9.3 billion dollars out of a total 12.18 billion dollars in export earnings in the last financial year to June 2007.
The factories employ around 40 percent of the country's total industrial workforce, according to the World Bank.