Bangladesh’s ready-made garment (RMG) exports to the European Union (EU) have surged by 48% in the past five years and by over 58% over the last decade. In 2024, exports reached €18.27 billion, up from €12.32 billion in 2020, as the country strengthened its foothold in the EU market.
The rise contrasts with the slower growth of overall EU garment imports, which grew by 24.92% during the same period, from €68.48 billion in 2020 to €85.55 billion in 2024.
However, industry leaders are wary of Bangladesh’s heavy dependence on the EU market. “While we have seen strong growth in Europe, we cannot continue to rely heavily on this region,” said BGMEA President Mahmud Hassan Khan Babu.
“We must diversify and focus on emerging markets like Japan, Australia, and South Africa,” where Bangladesh has made progress but still lags behind key competitors.
While Bangladesh’s growth has been notable, it’s also facing strong competition. China, historically the largest supplier to the EU, saw a decline in its exports from €20.56 billion in 2020 to €16.5 billion in 2024, marking a 19.56% drop.
The gap has been partially filled by Vietnam, which boosted its exports to the EU by 44.54%, from €2.75 billion in 2020 to €3.9 billion in 2024.
“Vietnam has capitalized on the shifts in the global market, and we must ensure that we do not fall behind,” Babu added.
Other competitors like India and Cambodia also posted strong growth, with Cambodia’s exports increasing by 59.77% over the last five years.
In addition to Europe, Bangladesh has also seen impressive growth in the US market, with exports increasing by 35.87% from 2015 to 2024, reaching $7.34 billion.
However, US garment imports overall decreased by 6.92%, highlighting the country’s resilience amidst global downturns.
“The US is still a key market, but we need to reduce our vulnerability by diversifying,” Khan Babu said.
Vietnam’s success in the US market mirrors Bangladesh’s, with its exports rising by 41.78% over the same period.
Despite the growth in both markets, former BGMEA President Anwar-ul Alam Chowdhury pointed out that the global demand for garments is no longer growing at the same pace as before.
“While we have gained market share, the European market is seeing stagnation,” Chowdhury said. He also emphasized the need to move from basic garment exports to higher-value products. “We are still exporting large volumes of basic garments, but we need to focus on value-added items to sustain long-term growth,” he added.
Bangladesh’s upcoming graduation from Least Developed Country (LDC) status presents another challenge.
The loss of GSP Plus benefits, which currently provides duty-free access to the EU, could result in increased tariffs and reduce the country’s competitive edge. “Once we lose GSP Plus, we will face greater competition from countries like Vietnam, which will continue to benefit from zero-tariff access,” Khan Babu warned.
Mohiuddin Rubel, former BGMEA director, echoed the concerns about over-reliance on Europe. “Currently, 50% of Bangladesh’s garment exports go to Europe, and with the US imposing counter-tariffs, we are increasingly vulnerable,” he said, emphasizing the need for broader market diversification.
To maintain its growth trajectory, Bangladesh must look beyond its traditional markets. “Diversifying into new regions and focusing on high-value garments will be key to sustaining growth,” Khan Babu concluded.
While Bangladesh’s RMG sector remains a cornerstone of its economy, adapting to global shifts and diversifying export destinations are crucial for ensuring long-term success, the industry leaders stressed.
