The growth of the ready-made garments export of Bangladesh’s could drop to about 15% this year after an unusually strong expansion of more than 30% in 2021, Reuters reported.
The report said that the US and European customers grapple with cost-of-living pressures due to the ongoing economic crises.
The slowdown follows a after the surge in sales in 2021, dubbed as ‘revenge shopping’ after Covid-19 lock downs eased.
Miran Ali, vice president at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) told the media that they should be at about 15% growth for the calendar year – this is going to be a normal year.
Fazlul Hoque, managing director of Plummy Fashions and former president of the Bangladesh Knitwear Manufacturers & Exporters Association also echoed the same that exports would rise by about 15% this year.
He said to the media that the customers were delaying orders by a month or so and cutting order sizes.
The manufacturers also fear for the increased price of by around 50% amid high international prices as the fuel accounts for about 10% of garment companies’ total costs and the use of diesel generators had gone up due to lengthy power cuts.
Shahidullah Azim, acting BGMEA president told the media that they will have to bear losses for the already placed order as after the abnormal oil price hike, production costs will go up sharply.
He said exports could grow to between $38 and $40 billion this year – or 6%-12% growth – and that the next year.
The garment industry accounts for more than 80% of total exports for Bangladesh, which sells to clients such as Walmart , Gap Inc, H&M, VF Corp, Zara and American Eagle Outfitters – some of which have already flagged weak sales as their customers prioritize basics.