Bangladesh’s ready-made garment (RMG) export to the European Union has sustained year-on-year negative growth during the first four months of this year.
It fetched 6.01 billion euro from RMG exports to the EU during January-April period of 2024 compared to 6.67 billion euro during the corresponding period of last year, according to Eurostat data.
RMG exporters said overall import to the EU fell during the period in question due to the global economic slowdown, while Bangladesh lagged behind its competitors due to energy shortage, long lead time and customs procedure.
The EU’s total apparel imports in the first four months of 2024 stood at 26.41 billion euro, which was 6.28 per cent lower than that of 28.18 billion euro during the same period of 2023.
China fetched 6.54 billion euro during the January-April period of 2024 against 6.66 billion euro, marking a 1.81-percent negative growth.
EU’s import from Turkey and India recorded 11.84 per cent and 10.74 per cent decline to 3.02 billion euro and 1.52 billion euro respectively during the first four months of 2024.
Vietnam also recorded a 6.25-percent decrease to fetch 1.17 billion euro during the period, according to Eurostat data.
During the period, in terms of value, Bangladeshi made knitwear items became the top clothing exporter to the EU making shipments worth of 3.37 billion euro followed by China that fetched 3.15 billion euro.
When asked, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) executive president Mohammad Hatem attributed high production cost, fuelled by a hike in utility prices and wage, to this negative growth.
“High lead time is one of the major reasons Bangladesh lags behind its competitors,” he said, adding that competitors like China and Vietnam managed to reduce the negative growth rate unlike Bangladesh.
Due to the power and gas crisis, they could not utilise full production capacity, while facing difficulties in procuring raw materials timely, requiring 20-25 additional days to produce goods and make shipments.
“Currently, we need 70-90 days of lead time, which was earlier 50 days,” Mr Hatem told the FE.
Besides, they could not receive orders at the prices buyers were offering mainly because of high production costs, followed by price hikes in gas and electricity as well as accessories.
The BKMEA leader also held customs harassment responsible for the negative growth, claiming that they faced difficulties in importing raw materials and making timely shipments.
Not only in the EU, Bangladesh recorded negative growth in the US and the UK too, he said, adding that these are the real scenario, although there is growth in the export data of the Export Promotion Bureau (EPB).
Talking to the FE, Fazlul Hoque, managing director of Plummy Fashions Ltd., also echoed Mr Hatem and added that though Bangladesh’s main competitors China and Vietnam are able to gradually reduce the negative growth rate, Bangladesh could not make it up.
The former BKMEA president, however, commented that markets are yet to be stable and normal, and said there is hardly any possibility that the country’s export growth situation would improve soon.
Bangladesh also recorded more than 14 per cent negative export growth to the US, its single-largest export destination, and fetched $2.30 billion during January-April period of 2024, according to US official data.