Bangladesh’s readymade garments (RMG) sector has shown impressive growth, recording an 18.6 per cent year-on-year increase in export earnings during the October-December period of fiscal year 2024-25 (FY ’25). The latest report from Bangladesh Bank (BB) revealed that export earnings reached US $ 10.36 billion, marking a 9 per cent rise from the previous quarter.
The bank attributes this robust growth to the resurgence of economic activities in advanced economies, particularly during the peak holiday shopping season in Western markets, which typically sees increased orders from major US and European retailers.
Despite facing inflationary pressures, supply chain disruptions, fluctuating fuel prices, and rising transportation costs, the demand from key export markets remained strong. Last year, the garment sector experienced significant turmoil, including demonstrations and production halts, following the ousting of the Sheikh Hasina-led administration on 5th August. This unrest impacted goods shipments severely in the preceding months.
The report highlights that high inflation, exacerbated by the ongoing Russia-Ukraine conflict, has affected consumer demand globally. However, Western economies have gradually rebounded, spurring retail sales and clearing out previous inventory levels.
Bangladesh has solidified its position as one of the world’s leading apparel manufacturers, thanks to competitive labor costs and a robust supply chain network. The RMG sector contributed 11.68 per cent to the country’s GDP during the quarter.
Nine countries, including the US, Germany, the UK, and France, accounted for nearly 70 per cent of Bangladesh’s RMG export earnings in the second quarter of FY ’25, with earnings from these markets increasing by 7.13 per cent compared to the previous quarter.
In terms of product categories, knitwear exports saw a quarter-on-quarter growth of 2.61 per cent, totaling US $ 5.48 billion, while woven garment exports rose by 17.23 per cent to reach US $ 4.88 billion, driven by increased consumer spending in both European and US markets.
The report noted that the RMG sector continues to contend with supply chain disruptions and heightened raw material costs, with imports of essential materials reaching US $ 4.03 billion, representing 39 per cent of total RMG export earnings.
Overall, the BB report underscores the resilience and steady growth of Bangladesh’s RMG sector during the October-December period, driven by rising global demand and enhanced production efficiency. Looking ahead, the outlook for the RMG sector remains positive, positioning Bangladesh as a formidable player in the global apparel market.
