Apparel exports to US see record 26% growth in Jan-Feb, but future uncertain amid tariff threats

Highlights:

• US imported $13.55 billion in apparel from global sources in January-February 2025
• Bangladesh's apparel exports to US surged by 26.64% to $1.5 billion in this period
• Long-term growth will depend on how US navigates its evolving trade policies, stakeholders say

Bangladesh's apparel exports to the United States surged by 26.64% in the first two months - January and February - of 2025, outpacing all major competitors, as US buyers continue shifting orders away from China. 

However, renewed trade tensions under the Trump administration's reciprocal tariff strategy are casting uncertainty over the future of global sourcing and market stability. 

According to official trade figures, Bangladesh exported $1.5 billion worth of apparel to the US during January-February 2025, up from $1.18 billion in the same period last year. This robust growth positions Bangladesh as the third-largest supplier of clothing to the US, following China and Vietnam.

While China and Vietnam also saw growth of 8.85% and 11.14% respectively, Bangladesh's rise was the strongest, driven by competitive pricing, enhanced compliance with labour and environmental standards, and a surge in orders diverted from China.

Businesses for resolving US tariff hurdles within 90-day suspension period

Yet, industry leaders are cautious. The Trump administration's recent push for reciprocal tariffs, aiming to penalise countries that impose higher duties on US goods, is reshaping trade policy in unpredictable ways. Although Bangladesh has not yet been directly targeted, fears remain that any shift in US trade policy or pressure for "fair trade" adjustments could eventually impact duty-free access or lead to new regulatory hurdles.

"This growth is encouraging, but the trade environment is becoming increasingly volatile," said Abdullah Hil Rakib, a former senior vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). 

"The uncertainty created by tariff politics in Washington makes it difficult to plan long-term investments or predict order flows."

The US imported $13.55 billion in apparel from global sources in the first two months of 2025 — an 11.20% year-on-year rise. 

India and Pakistan also gained significantly with 25.70% and 23.05% growth, respectively, while some countries like Honduras suffered a sharp 20.86% decline, highlighting the shifting dynamics in the sourcing map.

Trade experts warn that a more protectionist US stance could lead to increased scrutiny on trade benefits like the Generalised System of Preferences (GSP), though Bangladesh's apparel sector currently exports under a different regime.

For now, Bangladesh is seizing the opportunity — but the road ahead is fraught with uncertainty. Long-term growth, stakeholders say, will depend on how the US navigates its evolving trade policies and whether Bangladesh can continue to differentiate itself as a stable, ethical, and high-capacity supplier.

On 2 April, the US imposed a steep 37% retaliatory tariff on imports from several countries, including Bangladesh. Later, Washington announced a 90-day suspension of the decision, keeping only the standard 10% tariff in place for now.

"This pause gives us a strategic window," said Mashrur Reaz, chairman of Bangladesh Policy Exchange. 

"But what happens after 90 days is uncertain. We need to proactively explore what we can offer in exchange and engage on multiple fronts – diplomacy, trade talks, and market-based strategies."

He urged the government to consider offering reciprocal concessions, such as bonded warehouse facilities for US cotton exporters, and to reduce the trade imbalance by increasing imports from the US.

Reaz also advised pursuing a multipoint engagement strategy, including initiating diplomatic negotiations, increasing imports to reduce the trade gap, and holding discussions with buyers to explore market-based solutions.