Bangladesh’s export earnings have fallen 7.59 per cent this quarter. Value addition in readymade garment sector dropped 3.31 percentage points in the quarter. The country’s exporters are losing their competitive edge due to the overvalued currency and the increasing cost of doing business. The US-China trade war resulted in a slump in consumption of readymade garment products. The consumption fall also forced the country’s exporters to lower prices.

Import of raw materials represents 38.99 per cent of the country’s export value. The readymade garment sector imports raw cotton, synthetic or viscose fiber, synthetic or mixed yarn, cotton yarn and textile fabrics and accessories for garments as inputs for the production. The readymade garment sector contributes 83.52 percent to the country’s overall export earnings. Due to Bangladesh’s high dependency on garment exports, any instability in this sector in future could result in huge unemployment and a trade deficit. So the country needs to diversify its export basket.

Bangladesh’s competitors have already succeeded in this. Vietnam for instance emphasises electronics and other value-added export products. Bangladesh has to develop factory to port communication in order to reduce lead times and has to have a one stop service in trade procedure and documentation in product transaction.