RMG sector eyes 67 percent untapped EU markets

adv-06

The European Union (EU), the largest market for ready-made garments, consumes 50 percent of Bangladesh’s total exports, accounting for only 33 percent of the EU market, leaving the remaining portion untapped.

Photo : TDM

Among the 27 countries of the EU, Bangladesh exports more than $500 million worth of garments to 9 countries, while the export of RMG to other countries is below $1 million.

According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh fetched $47 billion from the EU market out of the $23.52 billion in the 2023 fiscal year. However, $22 billion comes from 9 countries, and the rest of the countries import insignificantly.

In fact, the apparel market of the EU had been severely affected by the pandemic and the ongoing Russia-Ukraine war. However, exporters believe they will revive the market from next year.

“We are working on marketing ‘Made in Bangladesh’ in smaller countries so that we can trade directly with them. Currently, those countries import from bigger sources. On the other hand, demand has also declined due to lockdowns caused by Covid-19 and economic downturn caused by the Russia-Ukraine war,” said Shahidullah Azim, the vice president of BGMEA, to The Daily Messenger.

“Since last week, some of our buyers have started coming back. Work orders are also increasing at a very slow pace. I think we will be able to recover all the dues next year,” said BGMEA President Faruque Hassan.

The BGMEA data shows that Belgium imports RMG worth $770 million from Bangladesh, France $2.94 billion, Germany $6.68 billion, Italy $2.26 billion, Denmark $1.26 billion, Netherlands $1.85 billion, Spain $3.57 billion, Sweden $918 million, Poland $1.73 billion in the just-ended fiscal year.

On the other hand, Austria imports only $57 million, Bulgaria $1.7 million, Finland $56.69 million, Greece $76.48 million, Ireland $246 million, Portugal $130 million, Romania $52 million, Cyprus $3.56 million, Czech Republic $389 million, Estonia $2 million, Hungary $209 million, Latvia $0.39 million, Lithuania $0.37 million, Malta $0.49 million, Slovakia $95 million, Croatia $64 million, Luxembourg $3 million.

Muhammad Hatem, executive president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said, “This bad time will be over, but we are worried about the power and gas crisis. If the government can resolve those issues, exports will increase in the EU market.”

EPB data shows that RMG fetched the highest-ever $46.99 billion, of which knitwear earned $25.73 billion and woven earned $21.25 billion during the just-ended fiscal year. In the same period of the previous year, the export of RMG stood at $42.61 billion; of this, knitwear earned $23.21 billion and woven $19.39 billion.

Meanwhile, in order to enter the high-end market in a few years, 25 blazer factories have been established in the country. Some of them have 190 production lines that make high-end woven products, which have been added to the export.

Normally, Bangladesh exports cotton-based products like T-shirts, sweaters, blouses, underwear, and denim. Bangladesh is the second-largest garments exporter in the world after mighty China. Among these, Bangladesh is the largest denim exporter to the USA and cotton to the EU.

News Source: The Daily Messanger