Tension over Brexit deal has slackened Bangladesh apparel exports to the United Kingdom during the first half of the current monetary year.
According to Export Promotion Bureau (EPB) data, in July-December period of the Fiscal Year 2018-19, Bangladesh’s apparel exports to the UK posted a meager growth by only 1.30% to $1.87 billion, which was $1.85 billion in the same period preceding year.
In the first half of the fiscal year 2017-18, Bangladesh’s Apparel exports to Britain saw a 20.70% growth to $1.85 billion.
On the other hand, in the fiscal year 2017-18, export growth to the UK was $12.63% to $3.72 billion, which was $3.30 billion in the fiscal year 2016-17.
Scrutinizing the latest data, it appeared that the exports growth of apparel goods to the UK is much less than the overall export performance of the same period in last fiscal year.
In July-December period of the current fiscal year 2018-19, Bangladesh netted $17.08 billion, up by 15.65%, which was $14.72 billion in the same period of last fiscal year.
As there is an uncertainty on trade and tariff policy over the Britain exit from the European Union, apparel importers have become conservative in placing work orders.
Apparel exporters and economists have blamed the ambiguity of Brexit for slowing down the export growth parallel to the previous one. They argued that the importers went sluggish being frightened over taxation policy after the execution of Brexit and imported fewer goods.
“As there is an uncertainty on trade and tariff policy over the Britain exit from the European Union, apparel importers have become conservative in placing work orders,” Mohammad Hatem, former Vice President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) said the Textile Today.
This is why exports earnings from the United Kingdom remained almost flat. But there is nothing to be anxious as the UK government has committed Bangladesh to provide duty and quota-free market access even after the execution of Brexit deal, said Hatem also Managing Director of MB Knitwear.
He also insisted the government remain alert and engage in continuous negotiation with the country to avail the trade facilities, what the exporters are now enjoying in entering into the UK markets.
Meanwhile, economists opined that Brexit anxiety also hit the Britain economy, which also decelerated the growth and cut demands of consumers’ goods.
“Brexit hits the economy of the UK, which reduced demands of local consumption as the country has seen slower jobs growth, former caretaker government adviser,” AB Mirza Azizul Islam voiced the Textile Today.
While the concern over the aftermath trade policy made importers vigilant in placing more work orders, said the economist.
Nevertheless, the UK is assuring Bangladesh to provide the same level of trade facilities, which is being given under Generalized System of Preferences (GSP) as EU associate, we should contemplate about trade policy mechanism in getting the facilities, he added.
In a referendum held on June 23, the UK people decided to leave EU as 52% people voted for an exit and 48% voted to stay with the union.
As per the conciliation, the deal will be executed on March 29, 2019. However, the UK government found it challenging after the Brexit vote at the House of Commons, where the deal negotiated by Prime Minister Theresa May was rejected by the lawmakers 432 to 202 votes – the biggest such defeat a government conceded in a century.