Bangladesh’s apparel exports to the European Union decreased by 4.98 per cent in the first half of 2024, totaling 8.72 billion euros, down from 9.18 billion euros during the same period in 2023, according to Eurostat, the statistical office of the EU.

Exporters attributed this decline to global challenges affecting all major exporting countries, including Bangladesh.

However, they said that Bangladesh has been disproportionately impacted due to the erosion of its competitive advantages, primarily driven by high utility costs, inadequate gas supply, and recent wage increases.

Despite the overall downturn, the country’s knitwear exports to the EU fell by 8.58 per cent in January-June 2024. In contrast, woven garment exports saw a marginal increase of 0.28 per cent, rising to 3.74 billion euros from 3.73 billion euros.

Fazlul Hoque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association, highlighted the severe impact of these challenges on Bangladesh.

He explained that while global difficulties have affected all major apparel-exporting nations, Bangladesh’s issues with utility prices, gas shortages, and wage hikes have made the situation worse.

Discussing the current situation, Fazlul said buyers rarely announce their decisions to shift or cancel work orders outright. Instead, they gradually redirect their orders elsewhere to mitigate business risks.

He shared that one of his buyers had been expected to place an order for the next season by the end of July, but he hadn’t received it, indicating that the order was likely diverted to other destinations.

Despite these challenges, Fazlul expressed optimism, suggesting that exports could recover in the coming months if the political situation stabilizes.

The European Union’s imports of readymade garments from various countries fell by 6.03 per cent in the first half of 2024, amounting to 38.47 billion euros, down from 40.94 billion euros during the same period in 2023.

The data indicated that Bangladesh’s 4.98 per cent decline in apparel exports to the EU was slightly better than the global average decline of 6.03 per cent in the EU’s apparel imports.

Eurostat data also revealed that the EU’s apparel imports from China decreased by 7.23 per cent in the first half of 2024, totaling 9.16 billion euros, compared to 9.88 billion euros in the same period the previous year.

While China remained the top apparel exporter to the EU in terms of value, Bangladesh surpassed China in knitwear exports to the 27-nation economic bloc in the January-June 2024 period.

Bangladesh’s knitwear exports to the EU stood at 4.98 billion euros, compared to China’s 4.51 billion euros.

In terms of woven garments, Bangladesh’s exports to the EU reached 3.74 billion euros in the first half of 2024, while China’s exports amounted to 4.65 billion euros during the same period.

Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association, said that long lead times are a significant factor causing Bangladesh to fall behind its competitors.

The ongoing power and gas crises have prevented manufacturers from utilizing their full production capacity, creating significant challenges in procuring raw materials on time, he said.

Hatem said that these disruptions have led to delays of an additional 20-25 days in producing goods and making shipments.

He also said that Bangladesh has experienced negative growth not only in the EU market but also in the US and UK.

According to EU data, apparel imports from Turkey to the EU declined by 10.95 per cent in the first half of 2024, totaling 4.59 billion euros, down from 5.15 billion euros in the same period of 2023.

India’s RMG exports to the EU fell by 4.53 per cent, reaching 2.32 billion euros compared to 2.43 billion euros in the same period of the previous year.

Similarly, Vietnam’s apparel exports to the EU dropped by 6.16 per cent in January-June 2024, amounting to 1.70 billion euros, down from 1.81 billion euros in the first half of 2023.