Bangladesh’s textile and apparel export share in global market will go up by 3.8 per cent in 2020 from current 2.8 per cent in view of rising demands from key markets, according to a Trade Forecast report of Hongkong Shanghai Banking Corporation (HSBC).
“Bangladesh has strong foothold in apparel production and will export more merchandise in the coming decade”, added the report.
Export value of Bangladeshi ready-made garments (RMG) rose by 13 per cent in the immediate past fiscal (2013-14) after posting 11.7 per cent growth during the fiscal 2012-13, with the US and the EU together importing almost two-third.
The trade confidence index of Bangladesh rose from 103 in the second half of 2013 to 141 in first half of 2014, the second highest amongst HSBC’s sample of 23 countries.
Garments make up around 80 per cent of total merchandise exports from Bangladesh. The value of exports from this sector is more than exports from India.
In 2013, half of Bangladesh’s total exports of garments and textiles went to Europe and a quarter went to the US. Amongst the 25 economies in the HSBC Trade Forecast, the report expects Bangladesh’s share of textiles and garment exports to rise from 2.8 per cent in 2010 to 3.8 per cent in 2020.
Within Asia, trade flows improved modestly in the second quarter. Recent data on PMIs and Hong Kong container shipments suggest this improvement is likely to continue. The report expects Bangladesh to grow rapidly over the remainder of the current decade, and investment, particularly in infrastructure, will continue to grow strongly to support this. Industrial machinery is the second largest import sector behind textiles and this will continue till 2030 with the sector contributing almost 20 percent of Bangladesh’s import growth.
China, India, South Korea and Indonesia will be Bangladesh’s fastest growing import partners, taking advantage of geographical proximity. “Nonetheless, the US, Germany and the UK are Bangladesh’s top export partners and this will remain unchanged till 2030, thanks to strong demand from the West for textiles and garments”, it notes.
Amongst the 25 economies in the Trade Forecast, Bangladesh receives around 20 per cent of its imports from China and by 2020 this share will be closer to 30 per cent, it says.
The authorities have introduced new safety laws for textile factories to strengthen standards, which has helped reinforce established relationships with international buyers and in turn should help the industry to expand production. “The 77 per cent increase in minimum wage for garment workers implemented in December 2013 will add to costs, but the industry is expected to remain competitive in global markets”, the report said.
