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RMG exports to US grow 4.81pc in first half

Inefficient port handling, lack of value added items impede country’s exports to key mkt

Monira Munni | August 16, 2018 00:00:00

Bangladesh's apparel exports to the United States grew by 4.81 per cent during the first half of 2018 compared to that of last year.

The country fetched $2.70 billion from apparel exports to the US market during January to June period of 2018 against $2.57 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.

During the period, Bangladesh shipped 1.0 billion square meter of apparel which was 964 million in first quarter of last calendar year.

The US imported a total of $2.83 billion of goods from Bangladesh during January to June 2018 period, it showed.

Export earnings from non-apparel items, including shrimp and plastic products, stood at $132.72 million during the January to June period registering a 2.91 per cent growth, according to data.

After the Rana Plaza building collapse in 2013, Bangladesh's apparel exports to US declined in 2014 and stood at $4.83 billion which was $4.95 billion in 2013.

In 2015, exports grew to $5.40 billion but continued declining trends in next two consecutive years.

In 2017, the country earned $5.06 billion from garment exports to US, according to OTEXA data.

A recent study conducted by the US Fashion Industry Association (USFIA), however, revealed that US-based apparel companies this year again considered Bangladesh as their fifth sourcing destination as the country offered most competitive price.

On the other hand, Chinese apparel exports witnessed a negative growth of 2.0 per cent to $ 11.27 billion in the first half of this year.

Meanwhile, the garment exports of Vietnam grew by 6.19 per cent to $5.72 billion and India witnessed 3.77 per cent rise to $2.07 billion during the same period.

Mohammad Hatem, vice president of Exporters Association of Bangladesh said Vietnam is in advantageous position especially in terms of lead time as it takes only 20 days to export to US.

Whereas Bangladesh needs nearly 40 days for the same, he added.

He blamed the infrastructural bottlenecks as 'the most disadvantageous' position for Bangladesh's retaining its competitiveness.

Moreover, Vietnam produces value added items, he noted.

He alleged that the policy support they received from the government could not avail as they faced wide range of harassment from the implementing agencies.

Khondaker Golam Moazzem, additional research director of Centre for Policy Dialogue, said the declining Chinese export to US showed that both orders and investment might be shifting to other destinations including Bangladesh and Vietnam.

"But Bangladesh might not grab the advantages of the shifting as seized by Vietnam," he noted.

It doesn't mean that Vietnam has advanced much but Bangladesh could not maintain its previous position, he said explaining that in recent times lead time has become a concern because of inefficient port handling.

Such inefficiency affects much to the woven segment as exporters mostly depend on imports of woven fabrics, he said adding as a result predictability of time might not possible for both import and export activities.

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