Some BD garment buyers prefer placing orders from 3rd country

Some BD garment buyers prefer placing orders from 3rd country

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Dhaka – The costs of apparel exports are going up as exporters now have to visit a third country to have purchase orders from foreign buyers in some cases following the two successive terror attacks in Bangladesh, according to the industry insiders, UNB news agency reported.They said many western buyers have cancelled their visits to Bangladesh and pulled out their representatives from the country soon after the attacks on Holey Artisan café in the capital and in Kishoreganj in early July last.
The RMG exporters, however, said there will be no serious adverse impact in the long run on their business, if the recurrence of such militant attacks can be prevented.
“The impacts of the terrorist attacks cannot be fully understood yet. If there is no further attack, the RMG sector will see no adverse impact in the long run,” said Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Md Siddiqur Rahman.
He, however, said the RMG sector is now being affected by a different issue, worldwide uncertain economic conditions particularly that of Europe and the USA, the major markets for Bangladesh’s readymade clothes.
“Buyers engage in harsh bargains and offers reduced prices as their purchasing power declines,” he said.
Echoing Siddiqur’s BGMEA first vice president Moinuddin Ahmed also claimed that the terrorist attacks has not affected the RMG industry and will not do either in the future.
“As the government has been able to contain militant acts with an iron hand, the buyers have regained confidence. There’re around 200 clients under Accord and around 150 clients under Alliance. The representatives of Accord and Alliance (two associations of foreign buyers) expressed satisfaction with the government’s steps at a meeting with the Home Minister after the militant attacks… so there’ll be no impact on the RMG sector,” he said.
But now buyers seek proper security for them during their visits to Bangladesh, Moinuddin said.
Noting that the RMG export is on right track, he said the export volume is likely to cross the government’s target of US$ 30 billion in the current fiscal. In 2015-16 fiscal, the export volume of RMG sector was over US$ 28 billion, up from the government’s target of US$27 billion, he added.
Former caretaker government’s finance adviser Dr Mirza Azizul Islam said, “The militant attacks might have little impact on the RMG sector, but the sign of that is yet to be seen.”
He said all buyers under the Accord-Alliance assured that they would not leave Bangladesh. “We hope the current problems will go if there is no recurrence of such incidents.”
Noting that many buyers are not willing to come to Bangladesh, Dr Aziz said costs of the exporters may go up slightly as they need third country to get purchasing orders in some cases.
Additional Director (Research) of Centre for Policy Dialogue (CPD) Dr Khondaker Golam Moazzem said the recent terrorist attacks will cast no major impact on the RMG production and export.
“Buyers don’t consider such incidents to give purchase orders unless the production is not hampered. Such incidents have little impacts on production and export,” he said.
But the attacks may hamper investment badly making both local and foreign investors particularly fresh investors indecisive to invest in the country, he said.
Dr Moazzem also said such attacks discourage buyers to open their local offices here and visit to Bangladesh.
After the Rana Plaza tragedy that killed more than 1100 people in 2013, the country’s RMG sector has passed through massive reform, which will have a positive impact on its exports soon, he said.
On July 1 last, militants overran Holey Artisan café killing 20 people including nine Italians who were involved in the RMG industry, seven Japanese nationals and one Indian girl whose father also works in RMG sector in Bangladesh.

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