Dhaka, Wednesday, 25 May 2022

Leather goods exports reach $365 million in four months

Leather goods exports reach $365 million in four months

Apparel Correspondent:Exports of leather goods had been in crisis for a long time. Although the government took various initiatives to increase exports, it was not getting much benefit. Not only at the government level, but also privately, various initiatives were taken to increase exports. The benefits of those initiatives are appearing now. The long-declining leather goods exports are booming. Export income has also started increasing.

According to the Export Promotion Bureau (EPB), in the first four months (July-October) of the current fiscal year 2021-22, exports of leather and leather goods amounted to $365 million (TK 3,128 crores). This amount is 29 per cent more than the same period of last fiscal year 2020-21. And about 11 per cent more than the set target. And 62 per cent of this income, that is, about Tk 2,000 crores came from the export of shoes. During July-October last year, Bangladesh earned $263.2 million from this sector.

Exporters say there is a lot of buying orders coming in the leather sector. Further exports will increase in the future. European countries are the main market for leather and leather goods of Bangladesh. The leather goods are also exported to several other countries, including the United States and Japan.

These countries have returned to normal after being closed for almost two years due to the COVID-19 pandemic. All kinds of shopping malls, big and small, have opened. People are shopping in full swing now. The economy is back on track. Like other products, demand for leather and leather goods is increasing. That is why leather goods exports are increasing, said the exporters.

According to the Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh, China accounts for 55per cent of the global shoe market. India and Vietnam also have good positions. Bangladesh ranks 18th in the world shoe market. However, Bangladesh's contribution to this sector in the world market is only 1.7 per cent.

After the pandemic, new possibilities have also emerged in the export of leather sector like readymade garments. Some orders from China, the main exporting country, have started coming to Bangladesh. Orders are also coming from Vietnam. If these opportunities are utilized well, the leather goods exports of Bangladesh will increase in the future, said the exporters of Bangladesh.

According to the Export Promotion Bureau (EPB), Bangladesh earned $113 crores by exporting leather and leather goods in the FY 2014-15. In FY 2015-16, it increased to $116 crores. In the FY 2016-2017, this income increased to $123.40 crores, which was the highest export income from the leather industry in the history of Bangladesh.

Since then, the export of this sector collapsed. In FY 2016-17, it came down to $108.54 crores. In FY 2018-19, it dropped further to $102 crores. In FY 2019-20, it came down further to $79 crores. Even in the midst of the pandemic, Bangladeshi exporters brought in $94.17 crores in foreign exchange from the export of leather and leather goods in the FY 2020-21. Exports increased by 18 per cent over the previous year. In the first half of the FY, the exports of this sector declined, but in the second half, it turned around and returned to growth.

From the beginning of the current FY2021-22, a positive trend can be noticed in the leather and leather goods exports. Exports have increased every month. According to the latest data, in the first four months of the FY (July-October), $365 million came into the country from exports of this sector. Growth has been 29 per cent; Revenue is about 11 per cent of the target.

About 62 per cent of this income comes from leather shoe exports. $9.63 crores came from the export of leather bags, luggage, wallets, belts and other products. The export of raw and wet leather has earned $2.25 crores in these four months. During July-October last year, Bangladesh earned $28.32 crores from this sector.

The government has taken various initiatives to increase the export of leather goods. In order to make this sector environmentally friendly, a project was undertaken in 2003 to relocate from Hazaribagh to Savar. The project was to be completed in three years. But even after a decade and a half, this industrial city has not yet become environmentally friendly.

Although the project was not completed, in 2017 the High Court announced the closure of the Hazaribagh leather factory. As a result, all the factories were closed. Several of these were certified by the Leather Working Group (LWG), a global platform for leather factories. Thanks to this charter, they could export leather to Europe and America, including Japan and Korea. Due to the closure of the factory in Hazaribagh, the tanneries lost the certificate and the buyer (foreign buyer).

Even after such a long time, the leather industrial city of Savar has not been fully prepared and the factories have not yet got the LWG certificate back. At the same time, new markets were not created. Due to lack of certification, the factories are not able to export leather under LWZ to Europe, America including Japan and Korea.