How Bangladesh's success in economic progress is better than many advanced countries?

Bangladesh's track record in dealing with recession and preventing economic collapse is better than that of many advanced countries. Despite the decline in demand in Europe-America during the bad times of global recession, the export income of the country's goods sector has increased by 6.67 percent compared to the previous fiscal year. In the financial year 2022-23, the amount of income earned by exporting goods stood at 5 thousand 555 million US dollars. Which is the highest ever export earnings. In the last financial year 2021-22, the export amount in this sector was 5 thousand 208 million US dollars. Compared to the previous financial year, the export income increased by 347 million US dollars. The Export Development Bureau has released the export statistics of the commodity sector for the just ended fiscal year. Although the export earnings have increased compared to earlier, the target set by the government has not been achieved. A target of USD 58,000 export earnings was set in the commodity sector for the fiscal year 2022-23 with a growth of around 10 percent. Exports fell short by 4.21 percent or 245 million US dollars in the outgoing financial year.

Bangladesh earned $5.03 billion in the month of June of fiscal year 2023, an increase of 2.51 percent from $4.9 billion in June of the previous fiscal year. The readymade garments (RMG) sector recorded the highest revenue of $46.99 billion in this financial year. In the previous financial year, this income was 42.61 million dollars.

The Export Promotion Bureau (EPB) released these figures on export earnings on Monday. It can be seen that only last June, 503 million dollars' worth of products were exported. Compared to June last year, this export is 2.51 percent higher.

Analyzing EPB data, it can be seen that exports of readymade garments, plastic products and non-leather footwear have increased in the outgoing financial year. On the other hand, exports of leather and leather products, jute and jute products, frozen food, agro-processed products, home textiles and engineering products declined.

According to EPB data, readymade garments were exported worth $4,699 million in the just ended fiscal year. This export is 10.27 percent more than last fiscal year 2021-22. The second highest exports of leather and leather products after ready-made garments were $1.22 billion. In this case, the export decreased by 2 percent. Besides, there has been 6.61 percent growth in footwear, 42.98 percent growth in manmade fiber, 26.23 percent growth in plastic products. On the other hand, there has been a negative growth of 19.1 percent in jute products, 27.47 percent in agricultural products and 20.76 percent in frozen fish.

Expected export targets have not been achieved due to inflation due to the Ukraine war, which is the main destination of the country's export earnings, the United States and European Union countries. However, exports of goods to countries like India, Japan, Korea, Australia have increased, which has helped sustain positive growth and is a good sign. As always, the highest export earnings in the recent financial year also came from the ready-made garments sector, amounting to USD 4,699 million. Out of this, 2 thousand 573 million US dollars were earned from knit garments and 2 thousand 125 million US dollars from woven garments.

Bangladesh has maintained this growth by relying on the export of ready-made garments, the main sector of export income. Garment exporters have earned 42.63 billion dollars by exporting garments in these 11 months. This figure is 10.67 percent higher than the same period last year. According to this, it is seen that 84.37 percent of the total export earnings during July-May came from ready-made garments.

Analysis of EPB data shows that during July-May i.e., 11 months of the outgoing fiscal year 2022-23, the export earnings have reached close to the entire period (12 months, July-June) of the previous fiscal year 2021-22. If this trend of growth continues, Bangladesh is going to set a record in product export earnings at the end of June.

In the fiscal year 2021-22, with a growth of 34.38 percent, export earnings crossed $50 billion for the first time. The government's target was $4,304 billion, but revenue was $5,208 billion. Based on that record, the government has set an export target of 58 billion dollars in the current financial year.

In 2019, the income of Bangladesh in the export of goods was 39.30 billion dollars, in 2018 it was 38.24 billion dollars and in 2017 it was 35.98 billion dollars. In terms of growth, Bangladesh is at the top of the European market. Bangladesh is ahead of China and Vietnam in the growth of garment exports to the United States. The growth of Bangladeshi clothing in the US market is higher than that of the two top garment exporting countries.

Nearly four-fifths of the country's total exports in the outgoing financial year came from the ready-made garment sector. Dependence of the country's export trade on special products should be avoided in the interest of sustainable economy. Initiatives should be taken to diversify exports.

Authored By: Ajanta Acharya PhD

Ajanta Acharya PhD,  is a senior researcher at South Asian Geopolitics  in Savitribai Phule Pune University, Pune, India.

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