The export during the period was down 25 percent over what was recorded in the same period last year. The figure stands at just 6 percent of what the industry exported six years ago. In 2004, Nepal´s RMG export to the US had crossed well over $21.25 million during the first two months. [break]
Statistics of Garment Association of Nepal (GAN) shows that garment exports in February recorded yet another drop of 60 percent and landed at $361,918. In January, export had grown by a quarter to $ 869,844, instilling some hope in the industry.
Exporters attributed the consistent downfall of the industry to reasons like eroding competitiveness in the international market, rise of labor stir and bandas that affected productions as well as timely delivery of orders. While instability in the country still remains the same, exporters said they have continued to refuse taking substantial orders for fear of missing delivery deadlines.
The industry had faced problems to hold market since 2002, when the US pledged duty-free market access to its competitors in sub-Saharan and Caribbean countries. The facility made the productions of those countries cheaper than Nepal´s by over 17 percent.
Contrary to the need of slashing cost to fight off looming crisis, rising labor stir and general strike over the years only added cost for domestic manufacturers. As a result, the industry witnessed massive closure of manufacturing units. Presently, only about a couple of industries are accepting orders from the US.
GAN, meanwhile, continues to argue that only three measures can pump back life in the industry: a Garment Processing Zone (the idea has been pushed since 1999) that lowers production cost; an order-based hiring system (sought since 2007) that frees manufacturers from undue labor liability; and a duty-free-entry facility for Nepali garments in the United States (lobbied for since 2005).
However, given the persistent political instability and weak government, these demands of entrepreneurs have found only deaf ears.
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