Home ›› 11 Sep 2022 ›› Front
As a part of its initiative to grab a 10 per cent global market share by 2025, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has decided to increase exports to India, Australia and South Korea to the $1 billion mark.
BGMEA has already taken several steps to execute the plan and appointed third-party logistics companies to find out opportunities in those markets.
Recently, Bangladesh’s apparel exports touched the billion-dollar mark in 11 countries and BGMEA wants to increase the number. Of the 11, only Japan represents the non-traditional market and the other 10 are the US, Canada and countries in Europe.
“Our target is to earn $100 billion in 2030 and we have to focus on the non-traditional market to make it happen,” BGMEA President Faruque Hassan told The Business Post.
He said, “For that, we will organise several roadshows in the destination countries to showcase our apparel industry. We will also maintain regular communication with the authorities concerned there as part of our apparel diplomacy.”
According to Export Promotion Bureau (EPB) data, Bangladesh exported $42.61 billion worth of apparel products in FY2021-22, marking a 35.47 per cent year-on-year growth. Only 14.96 per cent of the earnings came from the non-traditional market.
On the other hand, 73 per cent of the garment exports are limited to nine countries -- the US, Germany, the UK, Spain, France, Italy, the Netherlands, Canada and Belgium.
Under the circumstances, sector leaders have set a roadmap to increase exports in non-traditional markets such as India, Japan, Australia, Russia, South Korea, Russia, Brazil and the Middle Eastern countries.
Under the roadmap, local suppliers will focus on the diversification of goods and diversified garment items.
EPB data shows that $715 million worth of products were exported to India in FY22, which is 69.58 per cent higher than the previous fiscal year. The amount was $421 million in FY2019-20 and $422 million in FY2020-21.
As a neighbour, Bangladesh has the opportunity to export a massive number of goods to the Indian markets. But due to some non-tariff barriers, especially land port-related issues, the country is yet to take advantage.
Bangladesh had raised the issues during Prime Minister Sheikh Hasina’s recent visit to India and the Narendra Modi administration has pledged to address them.
“India is also highly interested to increase business with us because Bangladesh is one of their largest export destinations. We hope that bilateral trade will see a huge change within a year. We will set up warehouses in areas near the land ports,” said Faruque.
“If we can maintain the existing growth rate in Indian markets, export earnings will cross the billion-dollar mark soon,” he expressed hope, adding that BGMEA and the government are trying to resolve the problems.
As a Least Developed Country, Bangladesh currently enjoys duty-free access to South Korean and Australian markets. With that and by maintaining excellent bilateral relations, Bangladesh’s exports to both markets have grown over the years.
EPB data shows that the country earned $440 million from the South Korean market in FY22 with 36.44 per cent growth compared to FY21. The amount was $293 million in FY20 and $322 million in FY21.
On the other hand, in FY22, apparel manufacturers exported $812 million worth of products to Australia, which is 11.09 per cent higher than FY21. The amount was $601 million in FY20 and $731 million in FY21.
Industry insiders say there are opportunities for Bangladesh to increase exports to both these markets. China is a major supplier for these markets, even though South Korea and Australia are allies of the West.
Due to the US-China conflict, energy crisis and high production costs in China, both South Korea and Australia are very interested to increase imports from Bangladesh.
However, most of the people in these two countries like high-end goods and clothes manufactured from man-made fibres. But Bangladesh is lagging in these areas compared to its competitors.
Talking to The Business Post, Fatullah Apparels Chief Executive Officer Fazlee Shamim Ehsan said, “In recent times, we have been manufacturing value-added goods. Since people in Japan are wearing our clothes, South Korea will also test our goods definitely. We just need strong branding to boost our business.”
Bangladesh Knitwear Manufacturers and Exporters Association Executive President Mohammad Hatem also said, “We are working on this from multiple sides but the government will also have to take steps to help us achieve the target.”
“I believe that we will cross the billion-dollar export earning mark in these markets if we keep performing, with proper support, like the way we have been,” he added.
