NewsEconomy

Resilient export rebound to Russia through alternative channels

BTJ Desk Report
SHARE
Resilient export rebound to Russia through alternative channels

The conflict with Ukraine since February 24, 2022, raised concerns about the continuity of garment shipments to Russia. Initially, shipments, especially of garment items, experienced significant disruptions, with many ships bound for Russia having to wait at Chattogram port.

However, creative solutions emerged, bypassing the interruptions by utilizing alternative routes through Poland and Germany’s Hamburg. Local garment manufacturers sustained their efforts to meet the demand of Russian clothing retailers and brands.

In addition to route challenges, local garment exporters encountered obstacles in receiving payments, as European countries restricted major Russian banks’ use of SWIFT. Moreover, numerous Western clothing retailers and brands ceased operations in Russia in protest of the war.

Fortunately, most of these challenges have been overcome, and garment shipments from Bangladesh to Russia continue. Local exporters have adapted to receiving payments in Chinese yuan, and, in some cases, Russian importers pay them in US dollars through third-party countries such as Turkey, Germany, and neighboring nations.

Bangladesh Bank has also supported this by instructing the acceptance of payments in yuan, which further facilitates imports from China. With the departure of Western clothing retailers and brands, domestic Russian retailers and brands have revitalized their businesses on a larger scale, as the Russian economy was not significantly impacted by the war. Consequently, business in Russia has nearly returned to pre-war conditions.

Garment shipments to Russia increased by 45.65 % year-on-year during the July-September period of the current fiscal year, reaching $42.30 million, according to data from the Export Promotion Bureau (EPB).

SHARE

Comment here