RPT-Bangladesh exports down 3.5 pct yr/yr in July
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DHAKA, Aug 11 (Reuters) - Bangladesh's exports fell 3.5 percent in July from a year earlier to $2.5 billion, the Export Promotion Bureau said on Thursday, 25 percent below the target.
Readymade garments, comprising knitwear and woven items, fetched $2.12 billion in July, the first month of the 2016/17 financial year, down 4.4 percent from the same period of the previous year.
Exporters attributed the drop to holidays for Eid al-Fitr, which marks the end of the holy fasting month of Ramadan.
"The drop in July is mostly due to the long Eid vacation," said Siddiqur Rahman, president of the Bangladesh Garment Manufacturers and Exporters Association, discounting any impact on shipments as yet from a July attack on foreigners and other recent violence.
The $28 billion a year garment export industry had been recovering strongly from a major tragedy three years ago, when a factory building collapsed, killing more than 1,100 people and prompting safety checks that led to factory closures and the loss of exports and jobs.
It had also seemed little touched by recent murders of liberals, gays, foreigners and religious minorities in sporadic attacks claimed by Islamic State and al Qaeda.
But the July attack on a cafe in Dhaka's diplomatic quarter in which 22 people were killed, mostly foreigners, signaled a more chilling threat to business.
The garment industry fears that, over time, security worries may prompt buyers to look to up-and-coming garment centers such as Myanmar and Ethiopia that offer similar cost advantages.
Foreign companies, including Japan's Fast Retailing Co , owner of the Uniqlo casual-wear brand, have suspended all but critical travel to the country since the attack, although there are no signs yet of big players moving orders elsewhere.
"Buyers are placing orders as usual," Rahman of the exporters association told Reuters, adding that companies had also limited travel previously when there was political or other violence.
"We are a very secular nation, so this isn't a comfortable situation for us and it worries us that in the world our branding is now becoming negative."
The government says it has stepped up security for foreign business travelers, investors and diplomats.
Exports in the 2015/16 financial year that ended in June hit a record $34.24 billion, up 9.7 percent from the previous year, mostly driven by stronger garment sales.
The government has set an export target of $37 billion for the current financial year, with garments earning $30 billion.
Bangladesh relies on garments for around 80 percent of its exports and for about 4 million jobs. It ranks behind only China as a supplier of clothes to developed markets like Europe and the United States.
($1 = 78.40 Taka) (Reporting by Ruma Paul; Editing by Tom Hogue)
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