Kazi Azizul Islam: Bangladeshi garment exporters have suffered a major setback in their single largest market as Vietnam has taken over Bangladesh’s position of the second largest supplier to the USA in terms of volume. Quoting fresh data sent from the USA, sources at the Bangladesh Garment Manufacturers and Exporters Association said that in the January-June period of the current year, Vietnam’s apparel shipments increased by more than 26 per cent to 706 million square metres.

Bangladesh’s shipments to the USA, in that period, increased by less than one per cent (0.78 per cent) to 679 million units. In the first half of the last year Bangladesh was the second largest supplier to the American market with shipments recorded at 673 million units while Vietnam stood third with 559 million units.

However China, the top supplier, faced a more than 7 per cent decline in shipments as it exported 3,146 million square metres or equivalent units of readymade apparels. Shipments from Honduras, the fourth largest supplier, increased by more than 12 per cent, while Mexico stood fifth after suffering more than 15 per cent decline in shipments.

The president of the BGMEA, Anwar Ul Alam Chowdhury Parvez, said poor growth in shipments was the result of economic recession in the American market and intensified competition from other competitors.

‘Exporters are passing though a critical period as they are not getting the expected volumes of orders from the US buyers who procure the major portion of the cut and sewn and woven garments made in Bangladesh,’ he said.

Around 30 per cent of Bangladesh’s garment export proceeds come from the US importers who buy more than 60 per cent of its woven garments.

Renowned industry analyst Professor Mustafizur Raman said the poor growth of Bangladesh’s apparel shipments to the American market indicated that competition has intensified among global suppliers, who are now targeting the markets of low-cost and basic category apparels.

‘The Vietnamese exporters, blessed by higher productivity in their factories, and efficiency and advanced skills in their business operations, have increased their market share in the USA and have apparently grabbed the market share lost by the Chinese,’ said Mustafiz.

However Mustafiz, who is the executive director of prominent think-tank Centre for Policy Dialogue, pointed out that Bangladeshi exporters have increased their earnings by nearly seven per cent in spite of lesser growth in the volume of exports.

‘Bangladeshi exporters are gradually diverting to production of upmarket garments that are required for the much-talked-about value addition,’ he said.

He advised Bangladeshi garment exporters to increase productivity in their factories and enhance the skills of workers for more cost-effective production, and also attain the capacity to market their products professionally.

The Bangladeshi garment exporters, either in USA or EU market, mainly concentrate on the quantities of garment exports because they are fond of making low-cost and basic category apparels.

Bangladesh, according to data provided by the BGMEA, in terms of value of exports stood sixth with $1.62 billion earned from apparel exports to the USA during the period, while Vietnam stood second with export earning of $2.35 billion. Indonesia stood third with $2.02 billion and Mexico third with $1.99 billion.