Bangladesh's RMG export to Chile, China, Brazil falls sharply

Readymade garment (RMG) exports to three non-traditional markets of Chile, China, and Brazil declined sharply during the last two fiscal years (FYs) amid the Covid-19 pandemic.

The apparel exports to China fell to US$271.28 million in just concluded FY 2020-21, marking a decline of more than 46 per cent from the earnings of FY 2018-19, according to official data.

In 2018-19, Bangladesh shipped apparel items worth US$506.51 million to China, according to Bangladesh Garment Manufacturers and Exporters Association (BGMEA) data.

Similarly, RMG exports to Brazil stood at $70.73 million in FY 2020-21 which was $160.51 million in FY 2018-19.

The shipments to Brazil witnessed more than 55 per cent fall in the last two FYs, BGMEA data showed.

Meantime, the exports to Chile witnessed a declining trend with earnings of $82.56 million in the last FY which was $111.36 million in FY 2018-19.

When asked, Fazlee Shamim Ehsan, a director of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) said the pandemic has hit hard the overall RMG exports in all its destinations.

Though the performance was getting better gradually in the traditional markets like the USA and European Union, he said the growth is yet to reach the desired level in the non-traditional markets mainly because of the virus outbreak.

"We have established our relationship with the buyers of traditional markets through communications with their local offices or emails or other virtual ways despite travel restrictions from time to time during the last two years," he said.

On the other hand, both buyers and local suppliers could not move and explore the potential markets due to the travel restrictions, he said.

"As a result, we can't nurture our relations with those buyers who mostly source from the third party."

During the pandemic, China has reduced its purchase and met the local demand through its own production, Mr Ehsan added.

Irfanul Hoque, director of Fatullah Fabrics Ltd, said China mostly imports low-end products from Bangladesh.

In recent months, Chinese buyers have almost stopped their orders due to the rising trend in yarn prices, said Mr Hoque who exports products to China.

BKMEA vice president Mohammad Hatem, who is the managing director of MB Knit Fashion Ltd, attributed high import duty in Brazil, Mexico, Turkey, and South Africa to the fall in exports to these countries.

Turkey being an apparel-producing country took measures to protect its local manufacturers, he told the FE recently.

Talking to the FE, managing director of Sparrow Group of Industries Shovon Islam, however, said that with the revival of economic activities followed by the downturn of coronavirus spread, they were getting inquiries and orders from Brazil, China, and South Korea for delivering in the upcoming months.

Despite the pandemic, exports to Australia, Korea and Russia increased during the last two FYs, according to data.

The country fetched $731.13 million from RMG exports to Australia in the last FY which was $719.78 million in FY 2018-19.

Exports to Korea and Russia stood at $322.31 million and $593.66 million respectively in last FY which was $279.20 million and $488.58 million in FY 2018-19.

The country fetched $31.45 billion from RMG exports in FY'21, up from $27.94 billion in FY'20. The RMG export earnings were $34.13 billion in FY 2018-19.