Bangladesh’s Garment Exports Sees 6.31% Growth in July

Bangladesh's Garment Exports Sees 6.31% Growth in July

In a significant five-year span, Bangladesh has achieved remarkable success in its garment exports to the United States, doubling its revenue to a substantial $9.75 billion in 2022. This extraordinary growth is largely attributed to the country’s strategic shift towards producing high-value clothing and securing a substantial portion of orders that were previously centered in China.

Analyzing data from the Office of Textile and Apparels (Otexa), operating under the US Department of Commerce, offers a clear picture of the industry’s evolution. Garment imports to the US surged by nearly 28% between 2017 and 2022, reaching an impressive value of nearly $100 billion. During this same period, China’s garment exports to the US experienced a significant decline of around 20%, although it still remains the dominant supplier in this market segment.

Mohammad Hatem, the executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), emphasized their unwavering commitment to producing goods promptly and aligning with buyer demands. This commitment has fostered trust and enthusiasm, leading some US buyers to transition their orders from China to Bangladesh.

While Bangladesh was traditionally known for producing basic items, it has made remarkable strides in recent times, enhancing its capacity to manufacture high-value apparel. This transformation has attracted buyers from the US and other international markets.

A closer look at the Otexa data reveals that despite being the second-largest contributor to US apparel imports, Bangladesh’s share remains below 10% of the total.

Out of the top 10 nations exporting garments to the US in 2022, Bangladesh emerged as the standout performer, experiencing a remarkable year-on-year growth rate of 36.38%. In comparison, China’s exports increased by 10.83%, while Vietnam’s rose by 27%.

Although Bangladesh holds a commendable global position in apparel exports, it secures the third rank in the US market. However, experts unanimously believe that there is substantial potential for further expansion within the US market.

In light of this, Bangladeshi apparel manufacturers and exporters are being strongly encouraged to establish stronger connections with US buyers who are yet to transition their sourcing to Bangladesh or those who require smaller quantities. Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), underscored this point, emphasizing that while diversification of markets is important, significant opportunities for specialization within existing markets still exist.

Hassan further noted, “Since Bangladesh’s share in the USA’s apparel import market is only 9.75%, a significant opportunity exists to increase this share. Notably, Bangladesh has recently secured the top position in the USA’s denim import market.”

Shifting to more current developments, statistics from the Export Promotion Bureau (EPB) reveal a 6.31% increase in ready-made garment (RMG) exports to the US in the fiscal year 2023-24. The value has surged to $729.03 million, up from $685.77 million in the same period of the previous fiscal year.

Looking towards the European Union (EU) market, the growth story continues. Clothing exports to the EU saw a substantial 17.40% surge, reaching $1.95 billion in the first month of the 2023-24 fiscal year, compared to $1.66 billion in the corresponding period of the previous year.

This upward trend extends to key markets within the EU region, including Spain, France, Italy, the Netherlands, and Poland, which experienced growth rates of 36.35%, 22.71%, 36.75%, 23.03%, and 18.07%, respectively.

While these achievements are notable, there were instances of modest setbacks. Exports to Germany, the second-largest export destination for Bangladesh, experienced slightly negative growth of 0.70%, settling at $514 million.

Nonetheless, Bangladesh’s outreach to other markets remains dynamic. In July of FY 2023, exports to the UK and Canada reached $475.54 million and $128.89 million, demonstrating substantial year-on-year growth rates of 29.78% and 14.78%, respectively.

Furthermore, the realm of non-traditional markets also experienced RMG robust growth, with apparel exports increasing by 23.75%, totaling $674.82 million. Noteworthy non-traditional markets contributing to this growth include Japan, Australia, India, and South Korea, with impressive growth rates of 49.99%, 55.73%, 2.60%, and 19.59%, respectively.

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