Increasing demand for clothing alongwith a fall in inflation in major export destinations led to a spike in garment exports from Bangladesh during 2024. As per a report by the Export Promotion Bureau (EPB), apparel shipments from the country icreased by 7.23 per cent Y-o-Y to $38.48 billion during the fiscal.
Following the fall of Sheikh Hasina’s government on August 5, Bangladesh garment sector faced significant disruptions, including factory closures, production halts, and labor unrest. Protests, wage demands, and workplace discrimination fueled unrest, severely affecting shipments from July to October. However, gradually normalcy returned as factory owners accepted garment workers’ 18-point demands, including a 56 per cent wage hike.
Globally, persistent high inflation caused by the Russia-Ukraine war and its economic fallout dampened consumer demand initially. However, Western economies began rebounding in late 2024, with retail sales rising with inventories from previous years getting cleared in the US and Europe.
Garment exports faced fluctuations throughout the year. Shipments fell 6.62 per cent Y-o-Y in April to $2.38 billion and further by 10.48 per cent in June 2024. However, these began to recover again in September, with exports rising by 14.61 per cent to $3.01 billion. This growth continued through October, when exports increased by 22.80 per cent, In November 2024, Bangladesh’s garment exports grew by 16.25 per cent and in December they rose by 17.45 per cent rise to $3.77 billion.
Retail sales in key export markets, such as the US, also registered moderate growth. In November 2024, sales rose by 2.35 per cent Y-o-Y, according to the National Retail Federation (NRF). Buoyed by economic recover and lower retail sales, consumers seemed increasingly willing to spend, notes Matthew Shay, President, NRF,
Despite a challenging environment, Bangladesh’s garment industry adjusted its export target from $50 billion to $38.48 billion. Rising energy costs, volatile oil prices, and high interest rates affected smaller enterprises. Still, the confidence placed by international retailers on the country alongwith a devaluation in its local currency strengthened the industry’s resilience during the year.
Political stability and improved industrial relations will pave the way for further growth in exports, both in volume and value, opine Mohiuddin Rubel and Faruque Hassan, Former Leaders, BGMEA.
