- High US dependence may bring over 250 RMGs to edge as high tariff looms; 1,000 more factories will also feel the pressure
Over 250 Bangladeshi garment factories face severe repercussions if the United States proceeds with imposing a 35% additional tariff on imports from the country effective from 1 August. These factories are particularly vulnerable, as 60% to 100% of their exports are destined for the US market, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
Another 1,000 factories are also feared to feel the pressure, although their exposure to the US market is less significant, ranging from 1% to 60%.
Inamul Haq Khan Bablu, senior vice president of BGMEA and managing director of Ananta Garments Limited, told, “Those exporters who send more than 60% of their total exports to the US market will be most impacted.” He explained, “Already, due to the increased 10% tariff, most factories exporting to that country have had to bear 2% to 5% of the tariff burden, consequently incurring losses. If another 35% is added, these factories will not be able to survive exporting there in the long term.” Bablu also noted that “not just exporters, US buyers are also concerned.”
The US stands as Bangladesh’s largest single export market, accounting for nearly $9 billion worth of goods, of which over $7 billion comprises readymade garments.
Mahmud Hasan Khan Babu, president of BGMEA, informed that approximately 2,500 garment factories affiliated with the organisation currently export apparel to the global market.
According to BGMEA data, 1,322 of its member factories export to the US market. Additionally, some factories from the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), another prominent apparel exporters’ body, also export to the US.
While BKMEA Executive President Fazlee Shamim Ehsan could not provide precise figures, another source indicated that, excluding common members of both associations, around 200 factories export to the US, with roughly 50 of these having over 60% of their exports directed there. Cumulatively, over 300 factories from both organisations are poised to incur substantial losses due to their high dependency on the US market.
‘35% tariff pressure could be unbearable’
Ha-Meem Group, one of Bangladesh’s largest garment exporters, is heavily reliant on the US market. AK Azad, managing director of the group, shared his concerns at a discussion programme in Dhaka. ” I had received an email from a major buyer asking me to inform them what percentage of the new tariff I, as the supplier, would bear for products made from 1 August, if the additional 35% of tariff comes into effect,” Azad said. He added, “I export $80 million worth of products to that buyer annually, and my income from it is $1.37 million. If I pay 35% of the tariff from $80 million, how can I possibly bear it?”
The veteran exporter commented that in his 40 years in the business, he has never witnessed such a crisis in the export sector. “We, the businessmen, have brought this sector to a respectable position. But now we are disappointed.” Azad conveyed, “Disappointing news is coming from the US. The large brands we export to are monitoring and lobbying on the ongoing tariff negotiations with the US government. They have informed us that it doesn’t seem like you (Bangladesh) will get a good result.”
A factory owner in Narayanganj’s Kanchpur told that 80% of his exports go to the US. “My buyers are coming to Bangladesh to discuss how much of the increased tariff I can absorb,” he said. “This is not sustainable. If this continues, I may be forced to shut down the factory.”
‘Finding alternative markets will not be easy’
BGMEA President Mahmud Hasan Khan Babu underscored the difficulty of finding immediate alternatives: “It is not possible to find alternative markets for such a big market overnight. In that case, exporters might be able to export there for one season somehow. After that, there will be no option but to shut down.”
According to BGMEA data, 822 factories export up to 20% of their total volume to the US, amounting to $1.27 billion. Another 176 factories export between 21% and 40%; 87 factories between 41% and 60%; 91 factories between 61% and 80%; 46 factories between 81% and 90%; and 100 factories export between 91% and 100% of their total output to the US.
Meanwhile, a Bangladeshi government delegation is expected to travel to the US today or tomorrow for negotiations on the tariff issue, though no representatives from the private sector or the garment industry owners are included in the team.
Source: The Business Standard
- Bangladesh Retains Position as World’s Second Largest Apparel Exporter in 2024: WTO
Bangladesh held its position as the world’s second largest apparel exporter in 2024, trailing only China, according to data from the World Trade Organization (WTO).
The country exported garments worth $38.48 billion last year, reflecting a modest year-on-year increase of 0.21 percent.
This export figure accounted for 6.90 percent of the global apparel market, which totaled $557.50 billion in 2024. In comparison, Bangladesh held a 7.38 percent share in 2023.
The WTO data also confirmed that China remained the top apparel exporter, with exports valued at $165.24 billion in 2024 which is a 0.30 percent increase from the previous year. However, like Bangladesh, China experienced a decline in market share, dropping from 31.64 percent in 2023 to 29.64 percent in 2024.
Vietnam, ranked third in global apparel exports, saw stronger growth than both China and Bangladesh. Its apparel exports rose by 9.34 percent to $33.94 billion in 2024. Vietnam’s market share also increased, reaching 6.09 percent, up from 5.96 percent the year before.
Turkey ranked fourth, followed by India, Cambodia, and Pakistan. Indonesia placed eighth, while the United States was the ninth largest apparel exporter in 2024, according to WTO figures.
Source: The Daily Star
- Bangladesh’s Apparel Sector Confronts Rising EU Competition as Exports Dip in May
Bangladesh’s ready-made garment (RMG) sector may come under increasing pressure in the European Union (EU), its largest export destination, as exports dipped in May and China redirects its focus to the region.
Concerns have emerged that the US-imposed tariffs, including a proposed 35 percent duty on Bangladeshi goods, could force both local exporters and key competitors such as China, Vietnam, Cambodia, India, and Pakistan to focus more aggressively on the EU market. This trend is anticipated to exacerbate price-based competition, reduce margins even further, and threaten Bangladeshi apparel’s competitiveness in the 27-nation bloc. This change is probably going to make price-based competition more fierce, further reduce margins, and make Bangladeshi clothing less competitive in the 27-nation bloc.
A report by global supply chain compliance provider QIMA shows that in the second quarter of 2025, demand from European brands for product inspections in China rose by more than 5 percent year-on-year. The increase was particularly sharp in countries such as the Netherlands (27 percent), Austria (21 percent), Spain (6 percent), Poland (5 percent), and Germany (4 percent). Meanwhile, inspections and audits by US buyers in China plunged by 24 percent during the same period, indicating a clear shift in trade focus.
Although Bangladesh’s RMG exports to the EU rose by 17.8 percent to €8.97 billion in the first five months of 2025, up from €7.61 billion in the same period of 2024, the trend reversed in May. According to Eurostat, apparel exports to the EU fell by 10.5 percent year-on-year in May to €1.43 billion, compared to €1.59 billion in May 2024. This was the first monthly decline of the year, contrasting with strong earlier performances, including a 60.8 percent surge in January. Industry experts believe that initial growth may have been driven by inventory restocking or temporary demand spikes.
China’s garment exports to the EU increased by 17.1 percent between January and May 2025, totaling €9.04 billion. Total EU apparel imports increased by 12.3 percent year on year to €36.82 billion, up from €32.79 billion in the same period of 2024. Other major suppliers also had significant growth: Vietnam’s exports increased by 15.7% to €1.69 billion, Pakistan’s by 20% to €1.63 billion, Cambodia’s by 30.3% to €1.77 billion, and India’s by 19.1% to €2.38 billion.
Sayeed Ahmad Chowdhury, director of operations at Square Denim, told that the uncertainty surrounding US tariff policies has already prompted a shift in strategy. “We’ve started working with EU buyers like Inditex, which offer better prices and more consistent orders,” he said. He noted that the closure of major firms such as Beximco, Nassa, and Mahmud Group has freed up production capacity for EU-focused orders. If the proposed 35 percent tariff takes effect after August, he warned, pricing pressures will only worsen.
Former BKMEA president Fazlul Hoque echoed similar concerns. He noted that China, faced with declining US market share, may seek to compensate by expanding further in the EU, which would put additional downward pressure on prices and intensify competition for Bangladeshi exporters. He also pointed out that large local exporters, heavily dependent on the US market, may begin to shift toward alternative markets such as the EU, Japan, and Australia, further increasing competition in these regions. He added that Bangladesh’s high cost of doing business, due to rising energy and utility prices as well as wage hikes, is making it more difficult for exporters to remain competitive. If competitor countries like India benefit from lower US tariffs, Bangladesh risks losing its pricing advantage altogether.
Many exporters are already accepting orders for less than their production costs in order to keep operations going and meet wage obligations. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) reports that the country exported 1.23 billion kilos of garments to the EU in 2024, increasing 10.18 percent from 1.10 billion kg in 2023. However, the average price per kilogram declined from $16.88 to $16.07, a 4.84 percent decrease, indicating persistent pricing pressure despite greater export quantities.
Source: The Financial Express
- Bangladesh’s Apparel Exports to US Surge 21.6% in First Five Months of 2025
Bangladesh’s apparel exports to the United States recorded a significant 21.6% growth during the January to May 2025 period, according to the latest data from the Office of Textiles and Apparel (OTEXA). The total value of Bangladeshi garment shipments to the US reached $3.53 billion, marking a strong year-on-year increase compared to the same period in 2024.
During this five-month span, overall US apparel imports saw a modest rise of 7.06%, amounting to $31.70 billion. Despite broader market challenges, Bangladesh emerged as one of the top performers among major apparel-exporting countries, both in terms of value and volume.
OTEXA also reported notable changes in apparel import trends from other key suppliers. While China experienced a sharp decline of 10.02% in export value, countries like India, Vietnam, Pakistan, and Cambodia all posted double-digit growth, with Pakistan’s 21.58% rise closely matching Bangladesh’s performance.
In terms of quantity, Bangladesh’s exports to the US grew by 21.03%, reflecting a strong demand for garments from the country. Other suppliers, including Vietnam and India, also recorded significant increases in volume, while China’s shipments declined by 9.18%.
However, growth in export volume for most countries was accompanied by pricing pressures. Bangladesh’s average unit price per piece edged up by just 0.47%, while Pakistan and Cambodia saw declines of 3.24% and 4.19%, respectively. Vietnam was the exception, registering a 3.47% increase in average price per unit.
Commenting on the development, Mohiuddin Rubel, managing director of Bangladesh Apparel Exchange and former director of the BGMEA, told UNB that Bangladesh’s apparel exports to the US are maintaining growth momentum, even amid ongoing global uncertainties.
Source: The Business Standard
- Bangladesh and Vietnam Set to Dominate Global Cotton Trade Over the Next Decade: report
A recent report by the Organisation for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization (FAO) projects that Bangladesh and Vietnam will become major forces in shaping the global cotton trade over the next decade.
The OECD-FAO Agricultural Outlook 2025-2034 forecasts that global cotton trade will grow at an average annual rate of 1.6%, reaching around 12.3 million tonnes by 2034. This rise is mostly due to growing demand from Asia’s textile sectors, notably in Vietnam and Bangladesh, where mill use is rapidly expanding.
Bangladesh is predicted to account for 18% of global raw cotton imports by 2034, with an annual growth rate of 2.4%. Currently, the country consumes over 1.7 million tonnes of cotton, importing more than three-quarters of its needs. This expansion is driven by low production costs, an abundant labor supply, and favorable government policies that support the textile sector.
The report also highlights that the removal of the Multifiber Arrangement in 2005, an international quota system, helped pave the way for the expansion of the textile industries in Bangladesh and Vietnam. Both countries have also benefited from the European Union’s duty-free access under the Generalized System of Preferences (GSP)
Vietnam is projected to lead in annual growth of cotton mill use at 2.7%, with Bangladesh close behind at 2.1%. On the production side, global cotton output is set to rise by 1.3% annually, reaching 29.5 million tonnes by 2034, mainly due to improved yields.
Asia remains the core region for cotton processing, led by Vietnam, Bangladesh, and India. Although China is set to lose some of its dominance due to rising labor costs and stricter regulatory requirements, it will still be the world’s largest cotton processor by 2034, accounting for 30% of global use, followed by India with a 22% share. China’s declining cotton mill use, which began in 2010, was further accelerated by the end of the government’s support price system in 2014. As a result, processing activities have increasingly shifted to other Asian countries, especially Vietnam and Bangladesh. While China will remain the top processor, India is expected to overtake it as the largest cotton producer, supported by significant yield improvements. Brazil and the United States will also remain key exporters, supplying the growing demand in Asia.
Source: The Textile Today
- Bangladesh to Retain Duty-Free Access Under New Trade Scheme of United Kingdom
The UK government has launched the Developing Countries Trading Scheme (DCTS), under which Bangladesh will continue to enjoy duty-free access to the UK market in key sectors such as ready-made garments and electronic products.
UK’s Department for Business and Trade (DBT) on a statement reported the scheme simplifies the Rules of Origin, allowing countries like Bangladesh to export goods using components from various regions while retaining duty-free privileges. This move is expected to create new opportunities for UK businesses, strengthen supply chains, and encourage investment in emerging markets.
Bangladesh is among 64 countries receiving duty-free or reduced tariff access to the UK on thousands of products. Since June 2023, exports worth around £16 billion have entered the UK duty-free under the DCTS.
Monique Leeuwenburgh, sourcing director at Marks & Spencer, said the changes will support long-standing partnerships with Bangladeshi suppliers. Eoin Tonge, interim CEO of Primark, noted that the scheme will help sustain their sourcing strategy in key markets such as Bangladesh.
Trade analysts believe the DCTS will significantly benefit Bangladeshi exporters and enhance their global competitiveness.
Source: The Daily Sun
- Chattogram Port Gets First Tariff Hike Since 1986
Chattogram Port has decided to increase its tariff by an average of 30 percent for import and export activities.
Shipping Adviser M Sakhawat Hossain made the announcement on 25th July while talking to the media following a visit to the port in the morning.
The government aims to enhance the capacity of Chattogram Port and elevate its status on the global stage, Sakhawat said. To achieve this, he said, foreign operators may be engaged in managing operations at the port. He, however, assured that the overall control and supervision would remain in the hands of the government.
Sakhawat Hossain mentioned that the New Mooring Container Terminal (NCT) has seen significant progress since the Navy assumed operational responsibilities from Saif Powertec on July 7. Currently, container handling at the terminal has increased by approximately 13 percent, with an average of 3,200 containers being handled daily.
Commander of the Bangladesh Navy’s Chattogram region, Rear Admiral Mir Ershad Ali, stated that from July 7 to July 24, an average of 3,250 TEUs (twenty-foot equivalent units) were handled daily at NCT under the management of Chattogram Dry Dock — marking a 12.10 percent increase compared to the same period of the previous month. He added that during this period, 30 vessels successfully completed container operations and that vessel turnaround time has been reduced by 10 hours.
Source: The Financial Express
- BEPZA Posts Strong Export Growth and Job Creation in FY2024–25
The Bangladesh Export Processing Zones Authority (BEPZA) has reinforced its critical role in the country’s export performance, contributing 17.03% to national exports in FY2024–25, up from 15.9% the previous year.
Out of the $48.28 billion in total national exports, goods worth $8.22 billion were shipped from BEPZA administered Export Processing Zones (EPZs) and the Bepza Economic Zone in Mirsarai marking a 16.22% year-on-year increase.
In addition to this increase in exports, the zones saw the creation of more than 33,000 additional jobs, increasing overall employment from 500,110 in June 2024 to 533,527 by June 2025. The development of new businesses and the growth of already-existing industries led to this expansion.
Since its inception, BEPZA has facilitated exports worth $119 billion, with products reaching more than 120 countries worldwide.
Capital investment in the zones during FY2024–25 totalled $292.77 million, slightly down from $350.93 million the previous year.
A key development during the year was the signing of 33 new investment agreements with firms from China, South Korea, the United Kingdom, Ireland, the British Virgin Islands, Singapore, India, the UAE, and Bangladesh. These proposed investments, totalling $497.48 million, are expected to generate approximately 59,408 jobs.
Source: The Business Standard
