Home / EXCLUSIVE / Bangladesh aims to export USD 10 billion worth of leather goods by 2030

Bangladesh aims to export USD 10 billion worth of leather goods by 2030

Bangladesh aims to export USD 10 billion worth of leather goods by 2030

The commerce ministry is drawing up a ten-year perspective plan, which includes a target to increase the leather sector’s export earnings from below $1 billion to $10-12 billion by 2030.

If Bangladesh can live up to the target, it will be among the top ten global exporters in the sector, believe officials at the commerce ministry.

“It is possible to achieve the target set by the government,” Shaheen Ahmed, president of the Bangladesh Tanners Association, told The Business Standard. “But to do this, factories need to be made compliant.”

“Leather Working Group’s certificates are important in attracting foreign buyers. If factories are not fully compliant, it is not possible to get this certificate. And to get foreign buyers and higher prices for products, it is a must,” he added.

He called for the government’s policy support and said foreigners are now buying leather goods at lower prices due to poor compliance. The price will go up once the factories get compliant. Export income will also increase.

Foreign buyers buy leather after seeing certification by Leather Working Group – the number one globally recognised brand representing responsible leather sourcing to the industry and consumers.

However, only three companies in Bangladesh have received this certification so far. Others did not get the certificate as they were not compliant, which is one of the obstacles for export growth in this sector, says stakeholders in the sector.

The ministry is preparing the draft “Outline of Exports for the Leather Sector” under the export competitiveness for jobs (EC4J) funded by the World Bank and the Business Initiative Leading Development (BUILD) is working to update the perspective plan.

Among the country’s major export sectors, the entire supply of raw material for only leather and jute products comes from local sources.

According to the ministry and sectoral entrepreneurs, leather and leather products are an important sector of the economy.

This sector directly employs about six lakh people and indirectly employs three lakh others. Its contribution to the country’s total exports is about 4% and 0.5% of GDP.

China is now the world’s largest exporter of leather and leather products.

Italy, Spain and Hong Kong are the major markets for Bangladesh’s leather and leather goods. The country also sends leather products to different countries. It is possible to achieve the export goal if the leather industry is provided with the policy support for diversification, said industry insiders.

But the big challenge is to ensure compliance which plays a key role in increasing exports to the global market.

According to the Export Promotion Bureau (EPB), exports of leather and leather products have been declining since fiscal 2017-18, and currently remains below $1 billion.

Additionally, the impact of the Covid-19 pandemic has led to a sharp decline in leather exports in recent times. However, in fiscal 2020-21, exports increased by about 18%. The export grew by about 30% in the first seven months of the current fiscal year.

Shaheen Ahmed said leather exports were on the upward trend but have been declining since the forcible removal of tanneries from Hazaribagh to Savar. The exports cannot be increased due to a lack of compliance and some other issues.

For the expansion and progress, the government declared 2017 the leather, leather products year and leather footwear as the product of the year.

On the other hand, the industries ministry in 2019 formulated a policy for the development of leather and leather products, setting a target to increase exports to $5 billion by 2025 and increase the sector’s contribution to GDP to 1%. Find more.

|Source: Online/KSU

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