Bangladesh's apparel sector is under pressure in the global market as competitors like Vietnam and India made significant strides in high-value garment exports.
A recent report by the United States International Trade Commission (USITC) highlighted the shifting dynamics, revealing that Bangladesh is struggling to capture a larger share of the US market, which China is gradually losing.
Syed Ershad Ahmed, President, American Chamber of Commerce (AmCham) in Bangladesh echoed this sentiment. "Bangladesh is only offering competitive labour. We must focus on quality and speed of delivery; otherwise, we can't achieve the desired objective," he said.
Ahmed's comments underscore the need for the sector to evolve if it is to compete in an increasingly crowded market. The situation is further complicated by a decline in Bangladesh's apparel exports to the European Union (EU).
Eurostat data shows that from January to July 2024, exports to the EU dipped by 4.84 per cent compared to the same period last year, amounting to $11.11 billion.
This trend reflects broader challenges, with Bangladesh losing market share as competition intensifies globally, he said referring the data.
To regain momentum, industry leaders and government officials are exploring strategies to enhance product quality, optimize supply chains, and attract more foreign investment. "We need a smooth and comfortable environment for high-end production," Ahmed said, reiterating the importance of stability.
Fazlul Haque, former president, Bangladesh Knitwear Manufacturing and Exporters Association (BKMEA) acknowledged the growing challenges.
"Our competitors are advancing faster than us in many areas," he said.
Haque pointed out that political instability over the past 1.5 years has hindered Bangladesh's ability to manufacture high-end readymade garments (RMG).
"We need stability to move towards high-end RMG products. The support we receive now is piecemeal, and we require long-term, stable backing," he added.
The USITC report noted that Vietnam and India have outpaced Bangladesh in high-value apparel exports due to their improved infrastructure, increased foreign investment, and a stronger focus on quality. Bangladesh, which has long relied on its competitive labor costs, must now pivot to more value-added products to maintain its competitive edge.
Bangladesh's apparel sector remains a crucial part of the economy, but its future success will depend on how swiftly and effectively it adapts to the evolving global business climate.
