The apparel exports from Bangladesh saw negative growth from its largest and second largest single destinations – the United States (US) and Germany in the July-February period of the current 2022-23 fiscal year (FY).
According to the Export Promotion Bureau’s (EPB) country-by-country specific garment export data, exports to the major global destinations also experienced a narrow growth.
In the aforementioned period, Bangladesh earned $31.36 billion in the first eight months of FY23, fetching a narrow positive year-on-year (y-o-y) growth of 14.06% from $27.49 billion in July-February of FY22.
During this time, Bangladeshi manufacturers shipped apparel items worth $5.6 billion to the US – the single largest export destination – fetching a negative growth of 2.87% from $5.77 billion in the same period of the last fiscal year.
In the July-February period of FY23, they delivered RMG items worth $4.62 billion to Germany, the second-largest single export market, witnessing a negative growth of 1.03% from $4.67 billion in the same period the previous fiscal year.
However, Bangladesh witnessed a narrow positive growth of 14.52% by exporting apparel items worth $3.36 billion to the UK, the third largest destination, higher from $2.93 billion in the same period of the last FY, EPB data said.
Clothing exports to other important countries such as Spain, France, Italy and the Netherlands increased by 18.79% to $2.35 billion, 27.65% to $1.89 billion, 56.14% to $1.54 billion and 31.12% to $1.25 billion respectively.
However, like the previous few months, exports to Poland saw negative growth further by 15.06% to $1.09 billion, said the EPB data.
Apparel exports to the overall European Union (EU) soared by 14.29% to $15.72 billion from $13.75 billion in the same period of FY22.
Exports to Canada reached $980.96 million, fetching a YoY growth of 20.05% from $817.10 million in the same period of last FY.
The apparel export to the non-traditional markets reached $5.68 billion with a 35.02% YoY growth from $4.21 billion in the same period of the last FY22.
Japan, Australia, Russia, India, China, South Korea, UAE, Malaysia, Brazil, Mexico and some other countries are known as non-traditional markets.
Among the major destinations of the non-traditional markets, exports to Japan reached $1.07 billion, with a YoY growth of 47.65% from $728.65 million in the last fiscal year.
Bangladesh earned $753.92 million from India between July and February of FY22-23, a 61.57% increase from $466.61 million during the same period the previous fiscal year.
According to EPB data, non-traditional market exports to Australia, South Korea and Mexico climbed by 38.18% to $767.75 million, 39.81% to $387.63 million and 41.25% to $239.05 million respectively.
Talking to Dhaka Tribune, Shahidullah Azim, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that the growth in apparel shipment was based on value. As raw materials were costly, it was not a quantity growth, he added.
He also said that the situation between the EU and the US is not so good and they aren’t seeing any positive signs in the coming three or four months. However, the situation may improve after June or July.
BGMEA Director Mohiuddin Rubel said that the exports to the US have declined and it may continue for the coming months due to inflation and economic turmoil.
“However, we are getting inquiries for 2024. Maybe things will be better then,” he added, saying that the situation in Europe is still good.
But the growth in Germany was negative, which is a concern. “We have to observe the situation,” he added.
He also said that Japan is a potential market as it is a quality-sensitive market.
“We have a lot of room to grow there. We are doing very well in India. As we source raw materials from them and the lead time is also very short, we have good profit opportunities in India,” he added.
He also said that Bangladesh has to diversify its market and products and always keep focus on the growing economy.
Professor Mustafizur Rahman, a distinguished fellow of the Center for the Policy Dialogue (CPD), said that Bangladesh has to diversify its export as well as market and creating a regional market will also help.
In FY22, Bangladesh exported apparel items worth $42.61 billion from its global destinations.
