Mohammad Nurul Alam
USA is the single largest export destination for Bangladesh RMG exports but year-on-year export from July to February period of the current fiscal year 2023-24 fell by 2.58 % to $5.46 billion and the export was $4.79 billion and in the first seven months July-January of FY24, a fall of 3.90 %. According to data from the Office of the Textile and Apparel (OTEXA) of the US. garment shipments from Bangladesh to the US declined 24.91 % year-on-year to $6.79 billion in the January-November period in 2023.
According to sources garment import from Bangladesh declined 23% that is lower amount of clothing items last year compared to the previous year due to American retailers and brands are highly impacted by the current inflation situation at USA and which influences Bangladesh’s shipment to the US markets.
Bangladesh still is in good shape in the US market and experts say this is because of competitive price and having long-time trade relationship with US. Bangladesh is the third largest garment supplier to the USA after China and Vietnam.
The tariff to US cost 5.62 % which is the highest in the world in this particular market and after paying the tariff Bangladesh’s RMG export performance has been strong compared to its competitors in case of garment export to the USA.
Industry insiders believe as US economy started recovery from bad shape and so clothing sales have started increasing for the upcoming seasons.
The National Retail Federation (NRF), the largest retailers’ platform in the USA, said sales in the clothing and accessories stores were up 0.51% month-over-month and up 8.05 % year-on-year in February.
Bangladesh Apparel export marked as US$ 16.23 billion to the European Union (EU) that increased by 3.27% compared to previous FY during last 8 months from July to February of FY2023-24.
UK and Canada posted positive growth increased by 14.64 % and 1.81% Y-O-Y growth with US$ 3.85 billion and US$998.77 million in FY2023-24 respectively.
Country of EU bases namely Spain, France, Netherlands, Poland and Denmark showed has positive growth for apparel export from Bangladesh respectively 8.68%, 4.72%, 14.55%, 21.82% and 32.81%. But apparel export to Italy declined by 0.93% compared to the same period. In the last month export to Italy was recorded declined by 1.81%.
Germany the big apparel importer and the largest export market in the EU for Bangladesh, declined by 11.63% with an amount of US$ 4.09 billion compared to the July-February 2022-23. It was 13.46 % fetching an amount of $3.51 billion in this July-January period
Bangladesh’s total apparel exports amounted to $47.39 billion in 2023 and the share of apparel exports to non-traditional markets stood year-on-year growth at 18.72% in 2023. It was 16.10% in 2022 last year.
According to Export Promotion Bureau (EPB) report Bangladesh’s apparel exports to non-traditional markets jumped to $8.87 billion from $7.36 billion during January to December of 2023, in the corresponding period of previous year.
Among major non-traditional markets last year Japan was the top destination, imported apparel goods from Bangladesh around $1.68 billion, indicating a growth of 26.53% compared to 2022.
Australia, Russia, New Zealand, Saudi Arabia, South Korea and China those are also considered non-traditional markets also posted positive growth of apparel export. Japan and Australia are the only two non-traditional markets that received over $1 billion worth of apparels from Bangladesh.
During the war crisis Russia noticeably imported $479 million worth apparels from Bangladesh last year 13.13% growth from $423.21 million in 2022.
Industry insiders opined the positive growth to nontraditional market and declining export to US market is a good sign for Bangladesh to shift towards diversification and reducing excessive dependence on traditional market place. Because Bangladesh’s garment entrepreneurs are bring urged for diversifying export markets and cut high reliance on Europe and the US is paying off.
Sources said inflation in the US has been increasing since the onset of the Russia-Ukraine war in February 2022. In June of that year, the country’s inflation soared to 9.1%, marking the highest in 40 years. Consequently, consumers in the country reduced purchases of products other than daily commodities and fuel.