Photo: Messenger
On the one hand, exports of the country have been falling for the last two months of the current fiscal year, and on the other hand, remittance inflow is also frustrating. As a result, businesses are getting more worried about the dollar crisis.
Besides, the crisis of primary energy is deepening while the prices of gas and electricity are going up at regular intervals. Moreover, there is an indication that power prices will rise after the budget as an additional tax and VAT will be imposed on coal imports.
According to the data released by the Export Promotion Bureau (EPB) on Wednesday, exports fell by 16.06 per cent, earning $4.07 billion in May, with garments fetching $3.36 billion.
Data shows during 11 months of the 2023-24 fiscal year, exports stood at $51.54 billion, which was 2.01 per cent higher than the same period last year but 8.47 per cent less than the target. In the corresponding period, exports were $56.31 billion.
Experts think such an economic situation will not be healthy for doing business in the country. They said the government cannot control money laundering by controlling imports.
Unexpected falls in remittance make businesses and the government more worried because the government has to pay the huge outstanding bills in dollar while businesses have to import raw materials and machinery in that currency as well.
Mohammad Hatem, executive president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told The Daily Messenger, “The global economy is still impacted by inflation. The purchasing power of the people in Europe has declined. So, exports are going down.”
He said small and medium factories are suffering more. “They are even struggling to pay the salaries of workers because work orders have declined.”
SM Mannan Kochi, the newly elected president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told The Daily Messenger, “Yes, exports are going down as work orders have declined. Besides, garment prices are also getting lower while buyers are very reluctant to increase prices. New investments are also getting risky.”
Fazlee Shamim Ehsan, vice-president of Bangladesh Knitwear Exporters and Manufacturers Association (BKMEA), told The Daily Messenger, “The garment sector has been suffering since June 2022 due to the global economic slowdown caused by the Russia-Ukraine war. Moreover, due to the prolonged heatwave, productivity has declined as a result of the lower presence of workers in factories, especially those that do not have chillers.”
He earlier predicted exports in May would go down. He also expressed his concern over new investments in this sector, saying, “New investors cannot import heavy machinery due to the dollar crisis, but they are paying bank interests.”
Farhan Noor, general secretary of Bangladesh CNG Filling Station and Conversion Workshop Owners Association, said, “We cannot import spare parts. Cylinders are expiring. We cannot import new cylinders due to the dollar crisis. We cannot open letters of credit (LCs). If new cylinders are not imported, accidents may happen in the near future.”
According to the Bangladesh Bank, remittances amounted to $22.54 billion in May, $20.44 billion in April, $19.97 billion in March, $21.64 billion in February, and $21.13 billion in January.
Besides, exports were $5.72 billion in January, $5.18 billion in February, $5.10 billion in March, $3.91 billion in April, and $4.07 billion in May. In the upcoming FY25 budget, the government is going to allocate Tk 1,16,000 crore to pay interests on foreign loans, for which dollar is needed.
Messenger/Disha