Experts at a discussion have recommended allowing foreign direct investment in the garment sector, devaluation of local currency against US dollar and restructuring of the government incentives to help the sector cope with the existing problems.
These steps would also help diversify both markets and products, they said.
They also suggested product development, efficient management of garment waste and skills improvement.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) organised the discussion on 'Importance of product diversification' at its new public relation and research cell office at Gulshan in the city on Saturday.
According to the BGMEA data presented at the meeting, some 73 per cent of the country's total readymade garment exports ($34.13 billion) are concentrated on only five items; prices of 83 per cent of exports range up to $15 per kg and 74.14 per cent of the exports are cotton based.
The data also show that about 83.34 per cent of the total RMG exports go to European Union and North America.
BGMEA president Dr Rubana Huq, who presided over the meeting, explained the present situation in the sector, including the declining trends in export and prices of products.
She proposed using a multi-stakeholders' approach to help the sector overcome the ongoing and future challenges and possible social disruption.
Policy Research Institute of Bangladesh (PRI) Chairman Dr Zaidi Sattar said allowing foreign direct investment in the sector would help product diversification within the industry.
PRI Executive Director Dr Ahsan H Mansur recommended devaluation of local currency against US dollar, saying that Bangladeshi exporters are losing their competitiveness as their competitors have already devalued their currencies.
Additional research director of Center for Policy Dialogue Dr Khondaker Golam Moazzem said the government incentive packages for the sector should be restructured but without reducing the amount.
Incentives should be given to the targeted groups such as entrepreneurs who are producing value-added or upgraded items, managing waste efficiently and exporting items to markets other than traditional US, EU and Canadian markets, he added.
He also suggested identifying and addressing the problems on the supply side alongside the issues on the demand side.
H&M Bangladesh country manager Ziaur Rahman said one of the weakest point of local RMG industry is absence of product development.
The short-term issues could be addressed inside the factories, he said.
Pran RFL Group chairman and chief executive director Ahsan Khan Chowdhury, Deputy CEO and country head of Wholesale Banking, HSBC Bangladesh, Md Mahbub-ur Rahman and BGMEA directors also spoke.
During the presentation, the BGMEA recommended conducting studies on product diversification to identify potential products, depending on their nature of complexity and industry's readiness to expand in those categories.
Focus should be given on future expansion in the area of non-cotton, women/girls clothing, outerwear/athleisure, smart wearables, camping and travel goods, soft toys, products made of technical/functional textiles, it said.
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