Bangladesh remains top denim exporter to Europe, but shipments fall as Vietnam, China and India surge

Bangladesh has retained the top position in denim clothing exports to the European Union market. However, in the first eight months of this year, from January to August, Bangladesh's denim exports have fallen. In contrast, exports from competitor countries China, Egypt, Vietnam and India are rising rapidly.

According to figures from Eurostat, the EU's statistics office, EU countries imported 2.95 billion euros of denim clothing from various countries in the first eight months of this year. That import is 4.40 percent lower than in the same period last year.

Compared with the EU's overall imports, the amount of denim taken from Bangladesh has fallen more. In the first eight months of this year Bangladesh exported 870 million euros of denim. That export is 5.85 percent lower than in the same period last year. Bangladesh's share of the EU denim clothing market is now 29.40 percent.

Pakistan is the second-largest denim clothing exporter to the EU. In the first eight months of this year the country exported 530 million euros of denim. That export is 7.88 percent lower than in the same period last year. Pakistan now holds 17.78 percent of the EU denim clothing market.

The third and fourth largest denim clothing exporters in this market are Turkey and Tunisia respectively. In the eight months of this year Turkey's denim clothing exports fell by 21 percent. The country exported 440 million euros. Tunisia, on the other hand, exported 220 million euros of denim.

While Bangladesh's exports fell by nearly 6 percent in the first eight months of this year, Vietnam's rose by 45 percent. According to Eurostat, denim exports from China to the EU rose by 17.70 percent in the first eight months to 200 million euros. China's share of the market is now 6.67 percent. In January-August, Egypt's denim clothing exports rose by 31.46 percent to 200 million euros. Egypt's share of the market is also 6.67 percent.

Cambodia and Morocco, in the next positions, saw their denim clothing exports fall by 6.47 percent and 14.48 percent respectively. In the first eight months of this year Cambodia exported 140 million euros and Morocco 60 million euros of denim.

Vietnam exported 50 million euros of denim ready-made clothing to the EU in the first eight months of this year. That export is 45 percent higher than in the same period last year. In addition, India exported 30 million dollars of denim clothing in the January-August period, with growth of 18.62 percent.

Although Bangladesh lagged at the start of this year in the EU market, denim clothing exports rose by 12.71 percent in August. Exports in that period were 134.1 million euros. The EU's overall denim imports also rose. In August their imports rose by 11.23 percent to 430 million euros.

In August, Pakistan's denim exports rose by about 15 percent to 87.7 million euros. In that period Turkey's exports fell by 13 percent while Tunisia's rose by about 5.5 percent. China's exports rose by about 17.5 percent in August. Egypt's exports rose by 59.5 percent. Cambodia's exports rose by about 11 percent while Vietnam's rose by 56 percent. India's exports rose by 52 percent.

Mohiuddin Rubel, a former director of the garment owners' organisation BGMEA and additional managing director of Bangladesh Denim Expert, said that although orders were low in the first five months of the year, the next three months were somewhat better. That is why the rate of decline in exports is easing. But competitor countries have achieved higher growth in exports than Bangladesh. One reason is that Bangladesh cannot offer buyers a good price. Factories are suffering from high gas and electricity prices as well as shortages, raising production costs. In addition, product diversity is lower than in competitor countries.

In reply to another question, Mohiuddin Rubel said Vietnam has signed a free trade agreement with the EU. India is also in the final stage of signing an FTA. That is why buyers' interest in buying denim clothing from those two countries is growing. After LDC graduation, after a certain period the preferential market benefit or GSP in exports will no longer remain. Then effective steps will have to be taken to sign FTAs to ensure duty-free benefits for Bangladesh as well.