Bangladesh’s ability to seize a greater portion of the heightened global apparel demand in 2024 has been hampered by China’s outpacing in securing export orders, as highlighted in a report by Quality Inspection MAnagement.

In its second quarter 2024 barometer titled “Q1 Procurement Uptick: A Beacon of Hope for Western Retail?”, QIMA, a leading provider of supply chain compliance solutions, noted a promising trend after a period of sluggish demand.

The report highlighted a significant increase in sourcing volumes during the first quarter of 2024, both from overseas supplier regions and nearshoring markets.

The data revealed a notable surge in global demand for textile and apparel inspections and audits from garment manufacturing countries, with Bangladesh experiencing a growth of over 20 percent in Q1 of 2024.

While China regained popularity among apparel brands, competitors in Asia and beyond managed to keep pace.

United States and European Union-based brands increased their procurement activities in Bangladesh, signaling optimism for the country’s export sector compared to the challenges faced in 2023 due to political instability.

Despite this optimism, doubts lingered about the sustainability of this growth, particularly due to concerns surrounding the Bangladeshi government’s policy to reduce cash incentives for garment exports.

Recent data indicated a significant decline in Bangladesh’s apparel exports compared to its counterparts such as China and Vietnam in the US and EU markets.

In 2023, China experienced growth driven by emerging regions’ demand, and in Q1 of 2024, there was a resurgence in demand for Chinese products in the Western markets.

Demand for inspections and audits in China among US-based buyers grew by 12 percent year on year, with even faster growth observed among European brands. Notably, buyers from Germany, France and the Netherlands showed substantial growth rates of 35 percent, 30 percent, and 33 percent, respectively.

The report also highlighted continued interest in China’s manufacturing capacities from buyers in other parts of Asia, Latin America and South America, with double-digit growth in inspection and audit demand across these regions.

This barometer report, drawing from QIMA’s data on product inspections, factory audits, and a recent survey of over 800 businesses, provides an early insight into the state of the sourcing landscape in 2024 and the expectations for the months ahead.

According to the survey, two-thirds of respondents globally indicated plans to either maintain or increase their business volumes with Chinese suppliers in 2024.

Specifically, 59 percent of buyers in the US and 68 percent in the EU expressed similar intentions.

Former president of the Bangladesh Knitwear Manufacturers and Exporters Association, Fazlul Hoque, concurred with QIMA’s findings, highlighting Bangladesh’s limited gains from the recent surge in global demand for apparel due to rising production costs.

He noted China’s aggressive price reductions aimed at capturing a significant portion of the growing apparel demand worldwide.

Mohammad Hatem, executive president of BKMEA, echoed these sentiments, emphasizing Bangladesh’s diminishing competitiveness in the global market due to increased production costs and the success of competitors like China and Vietnam in securing more export orders.

Recent data from the US Department of Commerce’s Office of Textiles and Apparel underscores Bangladesh’s significant lag behind its competitors in apparel exports to the US market during the January-February 2024 period.

According to OTEXA data, Bangladesh’s apparel exports to the US declined by 19.24 percent during this period, contrasting with China’s marginal export growth of 0.48 percent and Vietnam’s slight increase of 0.14 percent.

Similarly, Eurostat, the statistical office of the European Union, indicated a decline of 26.74 percent in Bangladesh’s apparel exports to the 27-nation economic bloc during January-February 2024, while China’s exports decreased by 13.12 percent and Vietnam’s by 10.77 percent in the same period.