Apparel export to US jumps 10%

Bangladesh's apparel export to the United States (US) grew last year by 9.83 percent year-on-year, strengthening the country's position as the third-largest supplier to the American market, after China and Vietnam.

Bangladesh fetched nearly $6 billion from apparel export to the US during the January-December period in 2019 against $5.40 billion earnings during the corresponding period in 2018, according to Office of Textiles and Apparel (OTEXA) affiliated with the US Department of Commerce.

The country's export increased amidst a price hike of Bangladeshi ready-made garments, caused by the elimination of US Generalised System of Preferences (GSP) facility. Bangladesh has been operating without the facility since 2013.

Bangladesh's readymade garments export grew because of the ongoing US-China trade war, prompting both the countries to impose additional tariffs on their respective products, according to industry insiders.

Between January and December 2019, Bangladesh shipped 2.01 billion square meters of apparel to the US. The figure was 1.93 billion square metres in the previous calendar year, as noted in the latest update by OTEXA.

In 2019, world's largest exporter China saw a 9.10-percent decline in apparel export. Indonesia's readymade garments export also fell by 1.63 percent.

Meanwhile, Vietnam and India saw a growth of slightly over 11-percent and nearly 7 percent respectively during the same period.

In 2018, Bangladesh's total export earnings were increased by 6.65 percent to $5.40 billion. But in 2017, the earnings declined by 4.52 percent to $5.06 billion from $5.30 billion.

"The USA is the second largest market for Bangladesh RMG industry. In the last 15 years, Bangladesh apparel export to the USA increased by three times, which made up to 19.97 percent of the annual RMG exports. However, there is still a huge gap between USA's import and Bangladesh's export," said Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

The foreign minister will raise, to the US authorities, the issue of duty-free market access for Bangladeshi apparels, especially those produced from the US cotton, she added.

The "Made in Bangladesh" apparels have paid a tariff of $894 million in 2018, according to the BGMEA.

"As the third largest apparel exporter to the USA, we remain less competitive against Vietnam as we have to pay 15.5 percent in duty. But, Vietnam is supposed to pay 5.5 percent in duty," said Mohammad

Hatem, first vice president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

The country's apparel makers have been asking the government to negotiate with the US authorities for creating a space for duty-free export facility for those items made from the US cotton, he added.

The government should also provide some incentives for apparel exporters to make them competitive compared to the Vietnamese ones, said Hatem, also the managing director of MB Knit Fashion Limited.

According to the BGMEA, cotton products constitute a share of 74.14 percent of the Bangladesh apparel export. Against an increased demand for cotton, import of the item from the USA increased over the last three years. Bangladesh spent about $387 million on cotton import from the USA in 2018.

The country's apparel export to the US was $4.83 billion in 2014, while it was $29.79 billion for China, $9.26 billion for Vietnam, $4.83 billion for Indonesia and $3.40 billion for India.