Bangladesh’s apparel shipment to the US, the country’s single largest export destination, increased by about 51 per cent compared to last year. In the first nine months of this year, the country has exported a record of more than 7.5 billion US dollars in clothing. Noteworthy, Bangladeshi apparel makers are getting a strong foothold in the market as exports posted robust growth in recent times. Despite the global recession, the export of garments to the US has increased at a significant rate.
According to the Office of Textiles and Apparel (OTEXA), Bangladesh’s garment exports to the US market dropped slightly to $690 million last July but rose again to over $900 million in the next two months. During the last nine months of the current fiscal year, Bangladesh fetched billions from the US market by exporting primarily trousers, T-shirts, sweaters, blouses, underwear, etc. With an 8.54 per cent export share, the country remained the third largest apparel import source for the US.
The US is the single largest export destination for Bangladesh. Over 21.50 per cent of apparel export earnings came from this huge market. Bangladesh supplies quality goods at affordable prices, while the US buyers are happy with the safety standard of the industry. The surge in the export earnings comes at a time when the Western countries, the main buyers of Bangladesh apparel, are fighting a depressed demand mainly due to the energy crisis caused by the Russia-Ukraine war. The US is also facing the effect of a global economic recession as interest rates in the country are going high, and energy prices also have gone up. But people are still buying clothes there. The import figures indicate that the US retail industry is witnessing a fast recovery from the Covid-19 crisis.
Among the top 10 apparel suppliers to the US, imports from India, Indonesia, Cambodia, Pakistan, and South Korea grew 53.39 per cent, 54.66 per cent, 46.58 per cent, 40.11 per cent, and 39.61 per cent year-on-year, respectively. Earlier last year, Bangladesh exported 7.15 billion dollars worth of ready-made garments to the US market., which was about 37 per cent more than in 2020. The better-than-expected growth came as consumer spending increased more than in the government’s previous reading, while the value of imports was revised down. Imports are subtracted from GDP, which is the broad measure of economic activity within the country.
On a positive trend, the export earnings in the first five months of FY23 grew by 11 per cent compared to last year’s corresponding period, the latest export data showed. This achievement raised hope of easing the growing foreign exchange crisis Bangladesh has been suffering since July this year. Despite a surge in raw material prices the resumption of shipment of on-hold consignments and focusing more on diversification, the Bangladesh export market is creating a better option for all types of buyers.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Faruque Hassan said, “The apparel orders, which had been declining in the past few months, marked an upward trend because of product diversification and adding new export destinations.”
Bangladesh is exporting very essential clothing items at a reasonable rate, whose demand has increased slightly in the European market. However, European markets are mainly knit item-driven while the US market is driven by woven items.
Exporters have expressed hope that increased business in the US would make up for any possible export losses in European countries as they are going into an economic recession.
China is shifting its apparel manufacturing by itself, and at the same time, the US is shifting its sourcing from China in a big way.
Continued growth in exports to the US market is a silver lining for the overall apparel sector despite the threat of a slump in demand in European countries amid an ongoing recession. At the same time, the US dollar has become stronger, which also helped increase its purchase capacity. This is reflected in increases in prices considering unit and square meter value (SMV) and exports of value-added products.
The writer is a freelance columnist.