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05 March 2024

Bangladesh beats China in knit exports to EU

Jannatul Ferdushy

Published: 02:38, 8 December 2023

Bangladesh beats China  in knit exports to EU

Photo: Messenger

The traditional second-largest ready-to-wear clothing exporter in the world, Bangladesh has now taken the lead in exporting knitwear to the European Union (EU) markets – thereby surpassing mighty China amid the global economic slowdown following the ongoing wars.

Eurostat, the EU's official statistical office, revealed that the export value of Bangladesh's knitwear during the first three quarters of 2023 was €8.31 billion, while China’s export value was €8.27 billion, a 0.49 percent increase.

Industry insiders believe that Bangladesh will permanently dominate the world market, surpassing China within a few years, as China shifts its focus to value-added products.

Muhammad Hatem, Executive President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told The Daily Messenger, “We will undoubtedly maintain our position as we have a substantial infrastructure, while China is shifting focus from producing low-end products.”

Fazle Shamim Ehsan, Vice President for the trade body for Knit manufacturers, told The Daily Messenger, “Bangladesh has secured the top spot in knitwear exports to the market for the first time this year, amid sluggish demand in the EU. The main reason for this is that China no longer produces low-end clothing products. On the other hand, Bangladesh has developed strong backward linkages in this sector.”

He added that Bangladesh will also participate in the value-added market to compete globally. Manufacturers are already setting up such factories.

Bangladesh has become the largest denim exporter to the USA market, dominating 23 percent of the market, while China has only captured 14 percent, according to the Office of Textiles and Apparel (OTEXA) USA.

As per the monthly export trend, jeans exports were expected to reach $100 billion by 2023. But exporters are concerned that they might not earn as much this fiscal year as in the previous fiscal year.

Among Bangladesh's peers, Mexico grew by 21 percent to $500 million, Pakistan by 41 percent to $330 million, Vietnam by 29 percent to $307 million, and China only by 14 percent to $265 million, respectively, in the last year.

Exporters believe that the industry will bounce back to growth next year as China shifts away from producing cheap clothes. China has increased its investment in Vietnam in the high-end sector, making Vietnam a potential competitor for Bangladesh.

In the last decade, knit clothes, as fast fashion, have become popular worldwide for trendy designs and affordability. In the 2023 fiscal year, Bangladesh earned $25.73 billion exporting knit and woven products, fetching $21.25 billion.

Currently, China has increased its import of ready-made clothes from Bangladesh by 41 percent in July-October of the 2024 fiscal year.

Due to economic stagflation, the European Union continues to cut imports of ready-made clothes by 17.66 percent from Bangladesh and 20.17 percent from China.

Despite the economic challenges and reduced clothing consumption in many EU countries, Bangladesh earned $7 billion in July-October of the 2024 fiscal year, growing by 4 percent compared to the same period the previous year when Bangladesh earned $6.79 billion.

During the same period, Bangladesh fetched $2.57 billion from the USA, $1.8 billion from the UK, and $462.86 million from Canada.

Meanwhile, to enter the high-end market, 25 blazer factories have been established in the country in the past few years. Some of them have 190 lines that produce high-end woven products added to the export portfolio.

Normally, Bangladesh exports cotton-based products like T-shirts, sweaters, blouses, underwear, and denim.

Bangladesh is the second-largest garments exporter globally after mighty China, specialising in denim exports to the USA and cotton exports to the EU.

Messenger/Sun Yath

Islamic Merchant