Bangladeshi RMG producers are now facing stiff competition to penetrate into the market of the United States in the wake of the production cost hike and losing competiveness. Yet, export of Bangladeshi RMG products to the US market has grown by 7% in April 2015, to US$1.8bn, a good rise from 2.3% decline in 2014, according to data recently released by OTEXA. Besides, overall export to the US market also seen a 7.24% gain to $1.9bn. RMG manufacturers attributed production, political unrest and safety inspection launched by the global retailers’ platforms the Accord on Fire and Building Safety in Bangladesh and Alliance for Bangladesh Worker Safety. Myanmar, the emerging exporter of the RMG products to US market has posted a 123% growth to more than $8m in the first four months of this year. RMG export to the US market from Vietnam also increased by 16.5% to $799m while India’s export growth grew by 9.82% to $1.4bn. Meanwhile, China, the global leader of apparel manufacturing, lost its share in the US market, which was captured by Vietnam, Bangladesh and India in recent times. China’s export to the US market rose by over 1%, which is a positive sign for Bangladesh as it was expected that this share would be shifted to Bangladesh from Chaina. “As the fate of Bangladesh RMG industry is hanging in the balance, our competitors are taking the advantage of it,” BGMEA President MdAtiqulIslam told the Dhaka Tribune. Islam noted that productivity of Bangladeshi workers was lower than that of the competitors and devaluation of euros against dollars and political unrest also worked as catalysts to lower the growth. “On the other hand, compliance has increased production cost, which lead us to lose competitiveness in the global market,” said Islam. For gaining competitiveness and to overcome the existing hurdles, the BGMEA chief urged the government to provide policy support including lowering tax at source. “Apart from political unrest, compliance issue including installation of fire safety equipment and carry out the remediation cast shadow on the production cost leading challenging in competitiveness and the most challenge for the sector is to lose competitiveness,’’Abdus Salam Murshedy, president of Bangladesh Exporters Association (EAB), told the Dhaka Tribune. Though production cost has risen but the product price has not increased, which also makes the sector less competitive and lose market share, he said. “We are introducing production engineering and automation to reduce production cost and enhance productivity to tackle the situation.” He also urged the government to provide policy support to reduce production cost.
