Tannery moves hit Bangladesh leather exports

13 July 2018

Widespread structural changes to the country’s tanning infrastructure have been blamed for a 27% drop in Bangladesh’s earnings from the export of leather. The news comes in the middle of a nationwide effort to relocate a number of tanneries to concentrate leather production and improve efficiency.

The latest figures show that, of the total earnings from leather in financial year 18, the Export Promotion Bureau (EPB) calculated that leather products earned $336.8 million - a year-on-year fall of 27% - even if leather footwear bucked the downward trend, growing by over 5% to $565.6 million in the last fiscal year.

Leather accounts for 3% of total Bangladeshi exports, bringing in $1.08bn for the fiscal year 2018. However the relocation scheme, which has seen tanneries moved out of Hazaribagh in Old Dhaka to new, purpose-built parks such as the one at Savar Leather Industrial Park to the north of Dhaka, has slowed production while the moves take pace.  

"The majority of factories are yet to resume manufacturing since the relocation,” Md Shakawat Ullah, the general secretary of the Bangladesh Tanners Association (BTA), told the Dhaka Tribune.

"So far only 110 tanneries have restarted production [and] because of that, the production rate is low and that is why export earnings were lower.”

The export figures weren’t helped by continued growth in the popularity of rexine - a strong coated cloth which imitates leather and is especially useful for upholstery and bookbinding.

"Rexine and synthetic products are grabbing the market of leather products as they cost less," said MA Majed, an adviser to Bangladesh Finished Leather, Leather Goods and Footwear Exporters Association.



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