Exploit finished leather, treble export earnings
Bangladesh can earn three times more from leather goods exports if all the finished leather produced in the country in a year is utilised, industry players said.
Last fiscal year, the country exported $1.1 billion worth of footwear and other leather goods -- using only 30 percent of finished leather.
The remaining 70 percent finished leather was exported, mostly to China, said Saiful Islam, president of leather goods and footwear manufacturers and exporters association of Bangladesh (LFMEAB).
Finished leather exports fetch less than one-third of footwear: one square feet of finished leather fetches only $0.60, whereas footwear made from three square feet of finished leather brings $5.
Bangladesh produces 400 million square feet of finished leather annually, according to industry players.
The country has massive export potential of leather goods and footwear for its raw leather supply, said Syed Nasim Monzur, managing director of Apex Footwear, a leading shoe manufacturer and exporter from Bangladesh.
Presently, Bangladesh has 165 footwear and leather factories, which could fetch up to $5 billion in exports receipts were they compliant and used modern technologies.
In addition, the country has 161 tanneries that process raw hides into finished leather; and 98 percent of the tanneries are not compliant to global standards, said Dipankar Tripura, a finished leather exporter.
“The tannery owners are least bothered about quality,” he added. Foreign buyers of footwear and leather goods do not source from non-certified and non-compliant factories, said industry players.
Maruf Akter Mannan, director of OMC Group, a quality support and technology provider for the sector, also pointed out that many tanneries do not have proper water treatment and affluent plants.
Receipts from leather goods, footwear and finished leather exports have been crossing the $1 billion-mark for the past five years, but they are not growing further.
R. Baskaran, president of the Association of Footwear Components, Accessories and Machinery Manufacturers of India, vouched for Bangladesh's export potential.
“Now, Bangladesh needs efficient manpower and technology to earn more from exports,” said Baskaran, who took part in a leather tech and leather goods sourcing show that concluded yesterday.
Compliance and quality are the major factors to attracting foreign buyers and not cheap labour, he said.
Bangladesh's main export markets are: the EU, the US, Australia, Japan, Singapore and South Korea.
