Non-traditional markets drive export growth for Bangladesh
Are Bangladesh's export markets becoming more diversified? The latest data released by the Export Promotion Bureau (EPB) suggests so.
In the first ten months until April of the current fiscal year, exports to non-traditional markets grew by an impressive 30.80%, reaching $7 billion. Also, the market shares of non-traditional export destinations increased to over 18%, up from 15% during the same period a year ago.
Among the non-traditional markets, Japan, Australia, India, and South Korea emerged as the major players, with RMG exports amounting to $1.32 billion, $961.30 million, $889.06 million, and $477.81 million respectively.
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However, when it comes to traditional markets such as the USA, Canada, EU, and the UK, the export growth has been minimal and even negative in some cases, as per the EPB data.
The country's exports to EU countries showed a moderate increase of 8.58% compared to the same period in the previous fiscal year. Notably, exports to Germany, Bulgaria, and Poland experienced declines.
On the other hand, Bangladesh's RMG exports to France and Spain displayed positive growth rates of 22.21% and 16.69% year-on-year, respectively. Italy also demonstrated a positive trend, recording a substantial growth rate of 42.40% and reaching $1.85 billion.
In contrast, Bangladesh's exports to the USA, the largest market, faced a negative growth rate of 7.13% during the same period, amounting to $6.94 billion. On the contrary, the country's apparel exports to Canada and the UK markets experienced positive growth rates of 16.09% and 10.88% respectively.
Overall, the apparel industry in Bangladesh has demonstrated a YoY growth rate of 9.09% for the period of July-April in FY2022-23. The total RMG exports during this period amounted to $38.57 billion, with the EU market accounting for $19.20 billion, representing 49.78% of the total exports.
Industry experts have emphasised the need for Bangladesh to diversify its export markets in order to reduce its dependency on a few specific markets. They recommend that the government and private sector stakeholders collaborate to explore new markets and increase the country's export volume. Despite the challenges, Bangladesh's RMG sector has exhibited resilience in the face of the pandemic and is expected to sustain its growth trajectory, according to exporters.
