EXPORT earnings from the country's ready-made garment (RMG) sector declined sharply by 24.11 per cent during the first two months of the current fiscal year compared to the corresponding period of 1993-94

Accounting for nearly 60 per cent of the total export earnings, the RMG sector is reeling under various problems due to faulty policies and. at the same time, is facing increased competition from other manufacturing countries.

According to Export Promotion Bureau figures, earnings from the sector stood at only 192 52 million US dollars. against a target of 341.67 million dollars, during July and August of 1994-95 While the earnings from the sector was 253 69 million dollars during the same period of the previous fiscal vear

The robust double-digit growth rate of the RMG sector In recent years suddenly lost steam In 1993 94 Earnings from the sector during the pe rtod was 21 72 per cent lower than the target of 1.650 mil lion dollars as the total volume of exports declined by 4 72 per < ent

The EPB noted that the av erage export unit price and the export volume declined by 9 05 percent and 16 58 per cent respectively during Ihe first two months ol 1994 95

Wh it is more alarming. the I.PH pointed out. is that earn Ings Irom RMG exports to the United States the single largest market declined by 109 million dollars to 545 42

million dollars Instead of a projected growth of 25 per cent during the previous fiscal year

Industry circles attributed the decline to increased competition from other developing countries like. Vietnam. Sri Lanka. Kenya and Colombia, and also to some domestic problems facing the garments sector.

The rapid decline in ex port earnings from the RM< sector will continue unless tin government initiates immediate steps to solve the problems plaguing the sector.' cautioned Redwan Ahmed. MP. president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). earlier this year. .

He claimed that nearly 40 per cent of the 1.930 member factories of BGMEA have been turned Into sick units because of faulty government, policies.

The association identified 12 problems plaguing the sector and sought Immediate gov ernment Intervention to re move them. It sought with drawal of the 0.5 per cent tax at source imposed on the ex jiortable garments: streamlining the complex customs pro cedures; allowing duty free Import of all types of fabric and other chemicals; providing the export-oriented garment units with the same facilities given in the export processing zones; and reinstating the fa < llltv allowing Imports which have been shipped before opening of a back-to-back let ter of credit

rhe BGMEA had also set a deadline for October 24 for the

government to ineet their demands. but later withdrew after positive assurances from some senior ministers.

The government took two major decisions relating to the garment sector during the past year The quota administration policy, under which garment factories are allotted available quotas based on their performance. was revised and approved by the cabinet while the government also allowed the import of grey fabric by the garment units, a long-standing demand of BGMEA which was strongly objected to by the local textile mill owners.

The only silver-lining for the country's garment sector during 1994 came when the annual Bangladesh US textiles accord was renewed and Bangladesh's quota for export to the US market was increased