Apparel exports to US grow by 9.29 pc

FT ONLINE

Bangladesh's readymade garment exports to the United States grew by 9.29 percent during the first nine months of 2019 compared to the same period last year.

The country fetched $4.72 billion from apparel exports to the US market in the January to September period of this year against $ 4.32 billion earnings of the corresponding period of last year, according to data from Office of Textiles and Apparel (OTEXA) affiliated with the US Department of Commerce.

However, according to EPB data, the overall picture for Bangladesh in July-September was 1.64 percent negative growth.

Exporters note that they have been struggling for the last four months due to a lack of orders. They fear that such a situation may lead to a fall in export earnings in the coming days.

During the period January-September, Bangladesh shipped 1.82 billion square meters of apparel. The figure was slightly lower, 1.81 million, in the first three quarters of the last calendar year, as noted in the latest update by OTEXA.

During the same period, China, the world's largest apparel exporter, saw a 3.19 percent negative growth to 28.94 billion. The figure for the corresponding period last year was $29.90 billion. For their part, Vietnam saw a 13.09 percent growth to $11.02 billion and India saw a 6.35 percent growth to $6.22 billion.

BGMEA president Rubana Huq said: "Though we grew in the first 9 months as we go forward the trend is slowing down."

As she put it, "Nine out of the top 20 items have faced export declination in value terms this year and the price has declined for 8 items out of the top 20. The highest-priced growth item is women's or girls' woven anoraks by 102.22 percent and the highest price fall this week has been for babies' cotton knitted garments, by 35.55 percent."

"It reflects the exact situation of our RMG export to the US," she added.

Mohammad Hatem, Managing Director, MB Knit Fashion Limited, said the apparel industry has been going through a very critical phase in the last four months. It has been losing its market shares and orders have been shrinking day by day.

He attributed the situation to the fact that Bangladesh has been losing in competitiveness to countries like Vietnam, Cambodia, Pakistan, and Myanmar.

The negative trend will continue for the next few months, he added.

"Bangladesh has failed to derive advantage from shifting orders from China, in the way Vietnam, Cambodia, Pakistan, and Myanmar did," he stated. The reason is the local currency's appreciation against the US dollar," said Hatem, who is also first vice president of BKMEA.

"The government should introduce an export friendly currency for the US market to overcome the situation," he added.

Bangladesh's apparel exports to the US increased in the first nine months of 2019, which is a good sign against the backdrop of the country's overall negative RMG export growth of about 6 percent in the last 4 months, said Mostafiz Uddin, managing director of Denim Expert Limited.

However, Vietnam's exports to the US have increased much more than ours in the period, which signifies that we could not cash in on the situation as well as our competitors could, said Mostafiz Uddin, founder, and CEO of Bangladesh Denim Expo.

BGMEA director Asif Ibrahim said in the last three months our exports to the US market saw only a 1.70 percent growth, which in the January to June period was good. It was 14.45 percent, but in the nine-month period average growth was 9.96 percent."

"There is no need to get over-excited by these numbers. Until the country's exports rebound to the positive range, we should not be complacent", added Asif, who is also vice-chairman of Newage Group.

Preferring anonymity, a brand representative said Bangladesh is losing its market share for such reasons as a lack of diversified products, product development, and efficiency.

The representative also mentioned that Pakistan has been getting an advantage from its currency devaluation, while Bangladeshi exporters are struggling against odds.