The New Nation - Internet Edition

WE tried to bring in focus, some time ago, the failure of the country's "export powerhouse" to reach the projection of the Export Promotion Bureau (EPB). Economists, the media and the exporters themselves have adorned the readymade garment industry (RMG) with this welldeserved nomenclature. RMG sector indeed accounted for about 75 percent of the country's export earnings.

In the Fy 2005-2006 exports had grown by about 19 percent in knitwears and 14 percent in wovenwears in excess of the EPB projection. The previous Fy 2004-2005 witnessed growths of 35 percent in knitwears and 13 percent in wovenwears beyond the EPB projection. The concerned stakeholders acclaimed the growth as "robust" and even "galloping." Like pride, growth may have its fall as well. The decline in growth came in the Fy 2006-2007. Knitwears registered a negative growth of 6.03 percent for the first time in the "recorded history" of RMG industry, the economy's pride in terms of export earnings and the growth in wovenwears was a bare +0.16 percent as against the EPB projection.

By no standard it could be claimed that the RMG sector slumped since the export earnings exceeded the performance of the Fy 2005-2006. However, due to certain factors the EPB projected target could not be achieved in the Fy 2006-2007. These are: fire at RMG factories, labour unrest for unsatisfactory wages, non-compliance with buyers' conditionalities and unstable political situation from October 2006 to January 2007. Some foreign buyers had reportedly diverted their orders to Indo-China for the same reasons.

In spite of all that has gone wrong, buyers are still interested in the RMG products of Bangladesh.

Some experts apprehend that the country's RMG sector may be hard-hit due to lifting of sanctions on the Chinese products by the end of the current year. Similar apprehension was made in 2004 that the RMG sector would be in jeopardy with the withdrawal of MFA in December that year. But the country's RMG sector demonstrated great resilience and performed well.

We express our optimism that, this time also, Bangladesh's RMG sector will be able to face the challenge successfully. However, we expect that the government will extend all out support to the sector.