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Lack of diversity, FDI responsible

BD falls behind Vietnam in RMG export

Published : 08 Aug 2021 09:50 PM | Updated : 08 Aug 2021 11:47 PM

Bangladesh has lost its position in the world market of garments due to the production of few cotton-dependent garments, non-arrival of foreign direct investment (FDI) and low productivity of workers.

Bangladesh has lost its global position in terms of garment export against Vietnam as the country has earned 12 percent more growth than Bangladesh.

In 2020, Bangladesh Export earning was USD 2880 crore but Vietnam's earnings at the same time were USD 2890 crore. Due to this, the second top position held by Bangladesh for many years has been lost.

Centre for Policy Dialogue (CPD) research director Khandaker Golam Moazzem said, “The diversity of Vietnamese products is much higher than that of our country. Where we rely much more on cotton, apart from cotton in Vietnam, there are many kinds of products including synthetic, polyester, man-made fiber. As a result, they are able to attract more buyers. Again, the productivity of their workers is much higher than that of ours from which they are taking advantage.”

He also mentioned the lack of FDI in the garment sector in Bangladesh as one of the reasons for the backwardness.

The researcher said, “There is absolutely no foreign investment in the garment sector in our country. But compared to our country, foreign investment in Vietnam is much higher. Domestic investment is an asset to us but with foreign investment, this sector will expand further”.

However, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is hopeful of regaining the position of the world’s second-largest garment exporter by the end of the current financial year. At present, there are enough export orders in the factories, with some new initiatives being taken to regain the lost space this year, BGMEA officials said.

BGMEA President Faruque Hassan said, “Our factory was closed for about one and half months due to coronavirus in 2020. During that time we could not export anything. This is a big reason for falling behind. This year we are trying to get our position back”.

“There is another reason why we are lagging behind and that is non-cotton garment manufacturing. In order to get the place and be the best we are also working on this issue,” he added.