The depreciation of Chinese currency has alarmed Bangladesh's garment exporters. China devalued the yuan by about two per cent to support its exporters and increase economic growth. China is Bangladesh’s main competitor for apparel products in the European and US markets. But China has a 37.5 per cent share in the global apparel market while Bangladesh has a 4.85 per cent share.
Bangladesh feels the weakened yuan will give Chinese exporters competitive edge and allow them to sell their products cheaper. Since Chinese exporters get policy support from their government, Bangladesh exporters want the same from their government. Bangladesh exported goods worth $458.12 million to China in 2012-13 fiscal against imports worth $6.30 billion. Bangladesh’s export sector wants a special package to tide over difficulties. The nearly $32 billion export industry in July slumped 11.96 per cent from a year earlier.
While Chinese exporters are favored with a depreciated yuan, Bangladesh’s exporters have to face an appreciated Bangladesh currency against the euro. Exporters in Bangladesh want the government to lower petroleum prices in line with the plummeting oil prices in the international market and not shore up the country’s currency against the US dollar.