Bangladesh’s ready-made garment (RMG) industry is experiencing a notable decline in exports to the United States.
According to recent trade data, Bangladesh’s RMG exports to the US fell by 9.16% to $4.7 billion during January-August of 2024.
The Commerce Department's Office of Textiles and Apparel (Otexa) recently revealed this data.
Otexa data showed that in the period 2023, Bangladesh exported apparel items worth $5.18 billion to the US, the single largest destination of the country’s RMG products.
Securing the third position, Bangladesh has a 9% share in the apparel market of the North American country.
Almost all of the major apparel suppliers to the US faced negative growth due to curtailed demand, which was due to high inflation and economic turmoil.
In January-August 2024, the North American country's apparel imports decreased by 4.11% to $51.30 billion, down from $53.5 billion in the same period of 2023, according to Otexa data.
In terms of volume, Bangladesh RMG exports to the US in January-August of 2024 also plunged by 3.86% to 1.52 billion square metres from 1.58 billion square metres in the first eight months of 2023.
In 2024, Bangladesh earned $548.09 million in January, $637.20 million in February, $570.98 million in March, $550.60 million in April, $596.74 million in May, $496.87 million in June, $695.33 million in July, and 614.19 million in August.
According to their data, China and Vietnam held the first and second highest positions in the US market as of August 2024, respectively.
Among the other major suppliers, US apparel imports from China in January-August experienced a negative growth of 2.98% to $10.79 billion from $11.01 billion in the mentioned period of 2023. China has a market share of 21.18%.
Vietnam exported apparel items worth $9.55 billion in the first eight months of 2024, fetching a decline of 1.06% from $9.65 billion in the same period of 2023, claiming a market share of 18.59%, Otexa data stated.
Followed by Bangladesh, India secured the fourth position by exporting apparel items worth $3.21 billion in the first eight months of 2024, registering a negative growth of 1.47% from $3.26 billion in January-August of 2023. India has a market share of 5.84% in the US.
According to the Otexa data, the US RMG imports from Indonesia decreased by 7.16% to $2.68 billion, while the imports from Cambodia increased by 3.89% to $2.29 billion in the same period, which made them the fifth and sixth with a market share of 5.26% and 4.50% respectively.
Talking to Dhaka Tribune, Mohiuddin Rubel, director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that in 2024, the US's global clothing imports have consistently slowed, with a notable 4% dip in August.
Several key factors contributed to the sharp decline in imports from Bangladesh compared to major competitors between January and August, particularly the 36.72% drop in January.
“The national election caused some instability and economic uncertainty, while minimum wage negotiation triggered labour unrest, affecting factory operations and delaying production,” he added.
However, the second quarter saw some recovery, with Bangladesh's exports declining less severely than that of competitors.
“Yet, July and August were particularly difficult for us, with Bangladesh experiencing a year-on-year decline, while major competitors like China and Vietnam fared better,” he added.
He also said that the political instability and the transition of power have been primary factors in this, but the comparative price trend also played a significant role in the declining performance.
In 2023, apparel exports to the US experienced a negative year-on-year growth of 25.07% to $7.29 billion, which was $9.72 billion in 2022. Bangladesh has a market share of 9.37% in 2023 in the apparel market of the North American country.
