Western economic downturn hits footwear exports

The exports of leather footwear from Bangladesh declined 4.28 per cent year-on-year in July-May of the ongoing financial year owing to lower orders from Europe.

Footwear is the largest contributor to the earnings generated by the leather sector in the country.

However, the decline of order is a big slap to the sector.

Bangladesh shipped leather footwear worth $644 million during the 11-month period.

It was $756 million in July-May of 2021-22.

The shipment of leather products, however, increased 19.43 per cent to $361.47 million.

It was $337.62 million during the identical 11-month period of FY22.

Overall exports from leather and leather products, the second biggest export-earning sector after garments, inched up 0.42 per cent to $1.12 billion in July-May of 2023. Receipts stood at $1.11 billion during the same period a year earlier.

The European economy has received a huge blow from the global energy crisis stemming from the war, orders continued to decline.

Europe is the biggest market for the leather and footwear sector in Bangladesh.

Amid the lingering cost-of-living crisis, Europeans have cut consumption and the current trend in demand is expected to continue until normalcy returns to the economy in the bloc.

The latest blow has come from the power disruption the country is witnessing.

The power crunch has turned severe as many power plants are either shut or not operating at capacity.

Because of the lack of uninterrupted power supply, the production in our factory has declined sharply.

As a result, we are not able to deliver export-oriented items on time.

Owing to the economic slowdown, the export of shoes and leather products from Bangladesh has declined significantly.

The leather and footwear sector has fallen into difficulty driven by a rise in the production cost amid a spike in the cost of raw materials and labour whereas the prices of exported items have remained the same.

With the upcoming political tension and disconnection with the Western world due to the absence of democracy, voting rights, and human rights, the crisis will be deepened.

Restoration of democracy will help the country to reconnect with the civilized world for business to flourish.