Textile & Clothing Export Outlook; Growth continued despite

image shortfall
A S M Tareq Amin, Shayekh Munir & Maeen Md. Khairul Akter.

In the last few months the limelight was only on all negative things around Bangladesh and
its Textile & Clothing (T&C) sector. Incidents like Political unrest & hartal, Tajreen fire, Rana
Collapse, Worker Unrest, US GSP cancellation humiliated the sector and disregarded some
success stories. Amid continued crisis the sector outplayed all pessimistic forecasts and
successfully maintained the continued growth rate. Though US was rough, Bangladesh is
achieving noticeable growth on clothing export to the Euro zone and other emerging
clothing markets that registered good growth both in knitwear and woven wear in the just
concluding fiscal year 2012-2013. This article puts light on overall T&C industry outlook at
the end of the FY 2012-2013 and its export growth to the EU and emerging countries with
relevant statistics.

Introduction:
Although suffering from image crisis after the GSP withdrawal from USA, Bangladesh
registered remarkable export growth in the just concluding fiscal year. RMG export grew
12.71% to 21.5 billion USD and total textiles export including RMG rose to 23.7 billion USD
which is 11.24% higher than the previous financial year
Table 1: Export Performance of 2012-2013 over 2011-2012 (Source: EPB)
Export
% Change of Export
% Change of
Performance export
Performance export
July-June
Performance for July-June performance
2012-2013 Over
2011-2012 July-June
Mn. US $
Mn. US $
2012-13
Export
Over
Target for
2012-13 Mn.
Export
July-June
Products
US $
Target
2011-12
All products 28000
27027.36
-3.47
24301.9
11.22
(14) Silk (Chapter 0.01
0.18
1700
0.01
1700
50)
(15) Wool &
0.44
0.16
-63.64
0.61
-73.77
Woolen Products
(Chapter 51)
(16) Cotton &
130
124.96
-3.88
113
10.58
Cotton Product
(Yarn, Waste,
Junerics etc)
(Chapter 52)
(17) Jute & Jute
1082.56
1030.61
-4.8
967.38
6.54
goods (Chapter
53, 630510)

(18) Man Made

Filaments & Staple
Fibres (54-56)
(19) Carpet (Jute
& Others -57)
(20) Specialized
Textiles (Chapter
58-60)
(21) Knitwear
(Chapter 61)
(22) Woven
Garments
(Chapter 62)
(23) Home Textile
(Chapter 63
Excluding 630510)
All Textile &
Clothing Products
RMG (Knitwear &
Wovenwear)

86.04

101.45

17.91

81.39

24.65

6.83

8.46

23.87

6.23

35.79

149.29

124.52

-16.59

138.77

-10.27

10610.89

10475.88

-1.27

9486.39

10.43

10927.37

11039.85

1.03

9603.34

14.96

1150

791.52

-31.17

906.07

-12.64

24143.43

23697.59

-1.85

21303.19

11.24

21538.26

21515.73

-0.10

19089.73

12.71

Although total export of the country could not achieve the target, reach to 27 billion USD
having 11.22% rise on the previous year.
Table 1 shows export details of FY 2012-2013 over FY 2011-2012 for all textile and RMG
products. As a whole the connotation is positive amid a lot of negative happenings all
around the year. But is remarkable that export of combined T&C fall short of the target
taken the year back. RMG almost achieved the target. Woven garments preformed well,
experienced a great growth of around 15%. Knitwear missed the target marginally despite
good growth.
Other textile products didnt have any good news to give. Amid a great hope jute & jute
products miss the target by 4.8% after registering a mere growth of 6.54%. A great shock
has been received by Home Textile sector, export declined by 12.64% to 791 million USD
form the previous years 906 million USD.

Figure 1 shows the robust growth trend of the RMG sector of the country. Industry insiders
opined that if the country would not suffer great accidents like Tajreen and Rana collapse,
its export could cross all records this year. Political instability, strikes hartal and other
movements take way many buyers fleet away from Bangladesh this year.

New fiscal starts well to achieve ambitious target:

Export Promotion Bureau, EPB of Bangladesh has set an ambitious export target for the
financial year 2013-14 that is 30.5 billion USD, 12.85% higher than previous years export
27.02 billion USD. Though the country could not achieved the last year target, this time also
the country want to chase a big target. But the year has been started with a great uplift at
its first month.
Bangladesh exported textile and clothing (T&C) products worth of 2696.4 million USD in the
month of July, 13 which was 2538.8 million USD previous month and 2311.2 million USD in
the same month of the previous year. In fact, exports of the country's clothing products
witnessed a robust growth of more than 26 per cent in July 2013, amid clothing
manufacturers' apprehension that their shipment orders might fall following the tragic Rana
Plaza incidents and the image crisis that all were talking about of late aroused from the USA
GSP issues.
A late impact of Rana collapse and GSP suspension was spreading a rumour of order
shortage at the beginning of the new fiscal year. But still the figure indicates full opposite of
that. Industry insiders suggested that this growth in the first month of the fiscal doesnt
necessarily indicates the similar growth for the rest of the year as July was the month
before Eid holidays this year, hence it may get some unusual early exports of the following
month August. Upcoming political uncertainties are main concern for the rest of the year.
Country's overall export earnings rose to $3.02 billion in July, the first month of the current
fiscal year of FY 2013-14, from $2.43 billion in the corresponding period of FY 2012-13, a
boost by 24 per cent, according to the data of Export Promotion Bureau (EPB).

Of the total export earnings, knitwear items fetched $1.25 billion in July '13, registering a
25.24 per cent growth over the corresponding month of 2012. Earnings from knit items
surpassed
target
by
22.52
per
cent.
On the other hand, exports earnings from woven garments also rose by 27.02 per cent to
$1.26 billion in July 2013, which were 13.59 per cent up than the target.

Earnings from jute and jute goods stood at $80.15 million in July '13, showing a 2.10 per
cent growth. But the earnings fell short of target by over 22 per cent.

Conclusion:
Bangladesh largely depends on clothing and textile products for exports. Diversification of
export destination hence is must. The non traditional clothing markets are helping
significantly and the garments manufacturers should explore more of these markets and
introduce their product boldly. According to HSBC Global Connection report India and China
are going to be in the top five export destinations for Bangladesh. And rightly so India and
China with almost half of the world population have huge demand for clothing. Bangladesh
is situated in the perfect position to serve them. Capacity building must continue to improve
productivity and quality to be ready to be the largest supplier of clothing to those countries
within 2030. US are still the largest single country importing Bangladeshi products in spite
of the GSP cancellation. Improvement in working condition can still restore the GSP and
onwards Bangladesh can push for GSP in clothing.

So, the final verdict as of now for the clothing industry would be that the demand is there
in the market, what Bangladesh need to do is to build more capacity and try cope up with
the intra-industrial turmoil to be in a position to take the challenge of supplying clothing
products all around the world.

This is a shorter version of the article. Full Article is available in August 2013 issue.