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Bangladesh has targeted an annual export of apparels worth $100 billion. Manufacturers said that apparel exports increased by 35.47% to $42.61 billion in FY21-22 and up by 30.36% to $35.81 billion in the calendar year 2021.
If this growth trend can be by at least 15% annually, then this goal can be reached even in the current state of the world economy.
However, the reconciliation of many “ifs and buts” is also important like the end of the ongoing geo-political crisis, uninterrupted supply chain, no global recession, government policy support, and free flow of energy and power.
Earlier on July 5, manufacturers of the country set a target of exporting apparel worth $100 billion annually by 2030 in the event of the new logo and renewed visions unveiling of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
During the event, Faruque Hassan, president of the BGMEA said that along with basic export items, they need to focus on man-made fibres, technical textiles and high-value products.
Moreover, the country’s backward linkage sector is self-sufficient now and is expanding along with new investments.
“There was a target of $50 billion in revenue by 2021, but for various reasons, it did not happen. However, we are hopeful that in 2023, our revenue from this sector will exceed that amount,” he added.
By this time, the sector will also create employment for six million people.
He also said that circularity, recycling and transparency are no longer an option. It is now mandatory and they want to focus more on the environment and related issues.
Talking to Dhaka Tribune, Shahidullah Azim, acting president of the BGMEA, said that last fiscal year, the growth was more than 35%.
“If the global economy turns around or if there is no recession, this target is possible to achieve,” he added, saying that during the pandemic, they kept the factories open and maintained growth, demonstrating the resilience of the industry.
However, to achieve this target, some local factors like controlling the gas, energy and fuel prices and uninterrupted supply are important.
Mohiuddin Rubel, director of the BGMEA, said that everything needs to have a target to move forward and their target is to achieve $100 billion annually through exporting apparel items.
“We are not sure if it will really happen, but we will try to move forward with this target,” he added, saying that as per the current capacity and growth rate, it is possible, although there are many ifs and buts.
The growth must follow the global market situation and if a pandemic like Covid-19 strikes again or if economic conditions continue to deteriorate, it will be tough.
Moreover, the development of the country’s infrastructure, exploration of new markets, production of high-end products and contracts with good buyers are also very important in this field, he added.
“The global market is growing at 5%-7% every year and our target is to achieve $100 billion. As the second largest exporter, this target is not unreasonable or much,” he added.
China is shifting from apparel and those orders are coming to Bangladesh, he added, saying that buyers are leaning towards Bangladesh and they need to retain this interest.
“If we can develop our infrastructure, capacity, productivity, and explore new markets, and get policy support from the government, achieving this target won’t be impossible,” he added.
Shifting orders from China; New ray of hope?
Gradually, China is phasing out of the apparel industry and due to the trade war, Western buyers are showing reluctance to place orders there.
“Due to the current global situation, our inquiry declined by nearly 20%-30%. But at the same time, orders are shifting from China to Bangladesh. Which shows us some hope,” said Abdullah Mohammad Zaber, managing director of Zaber and Zubair Fabrics Ltd (Noman Group).
These orders are likely to be around 10% of total placement, which will surely help Bangladesh to sustain growth, he added.
Shahidullah Azim echoed him saying that orders are shifting from China to Bangladesh and they are monitoring it.
In detailed planning, Mohiuddin Rubel said that due to various reasons, buyers are moving away from China and looking for alternative sources, and Bangladesh is leading there.
“Since China is the first and Bangladesh is the second, Bangladesh is the first choice for buyers as an alternative to China,” he added.
“However, Bangladesh cannot take all the orders except those they have the capacity to take,” he further said.
“We have a lack of infrastructure, which is gradually improving. So, we are taking the orders gradually and that’s why government policy support is very important,” Rubel said.
Moreover, the industrialists also have to go to the production according to the demand and trends of the buyers in the global market, he added.
Non-traditional market: the running mate
“We are also thinking about market expansion. We are emphasizing increasing our exports to Asia, South America, Oceania and other new markets,” said Shahidullah Azim.
Some of the markets are very close to Bangladesh, which will help to reduce lead time and freight costs will be less and the price will be good enough, he added.
However, manufacturers also said that the BGMEA is working to implement a final roadmap by three separate research institutes regarding the $100 billion target.
“There is a growing demand for manmade fiber in the global market with a market of $200 billion. We are increasing investment there,” he added.
(DT)
