Bangladesh’s RMG sector lost EU market share from 24.4% to 21.9% in Jan–Apr 2026 — the steepest decline among major exporters. India held its ground with only a 12.1% export contraction; China expanded to 28.6% market share; Vietnam cut losses to 0.7% while growing high-margin knitwear by 2.3%. Unit export value dropped from €15.59/kg to €13.96/kg. Structural gaps in raw materials, logistics speed, and trade agreements are widening the competitiveness gap versus regional peers.
According to www.dhakatribune.com, Bangladesh’s ready-made garment (RMG) sector saw its consolidated market share in the European Union drop from 24.4% to 21.9% during January–April 2026, marking the sharpest structural footprint loss among all primary garment-exporting nations in the region.
EU Procurement Shifts Accelerate
Eurostat’s latest official trade data reveals a pronounced realignment in EU apparel sourcing. While global fashion retail faces broad consumer demand contraction, regional competitors have retained — and in some cases expanded — their positions. India limited its export contraction to 12.1%, maintaining stable market share thanks to an extensive domestic raw material base and rapid progress toward an EU–India Free Trade Agreement (FTA). Chinese exporters, facing high U.S. import tariffs, adopted aggressive pricing models backed by state subsidies and automated logistics — lifting China’s EU market share to 28.6%. Vietnam, leveraging the EU–Vietnam Free Trade Agreement (EVFTA), reduced its export decline to just 0.7% while increasing high-margin knitwear shipments by 2.3%.
Price Squeeze Deepens Margin Pressure
Compounding volume losses, Bangladeshi manufacturers face severe margin erosion. The average unit value of apparel exports to the EU fell from €15.59 per kilogram in Jan–Apr 2025 to €13.96 per kilogram in the same period of 2026. This 10.5% unit-value slump reflects steep discounting to clear inventories amid rising domestic operating costs and persistent logistics delays. In stark contrast, Vietnam raised its average unit price — underscoring its competitive strength in technical, high-value apparel segments.
Structural Disadvantages Mount
Industry analysts emphasize that Bangladesh’s challenges extend beyond cyclical demand softness. Local factories lack access to integrated upstream inputs — unlike India’s vertically aligned MMF (Man-Made Fibers) ecosystem or China’s subsidized automation infrastructure. Meanwhile, rising energy costs and port congestion at Chittagong have extended lead times, undermining responsiveness in an era where EU brands increasingly prioritize agility over cost alone. As global fashion firms double down on ‘China Plus One’ diversification strategies, sourcing decisions are shifting toward hubs with faster turnaround, tariff advantages, and policy-backed infrastructure upgrades — criteria where Bangladesh currently lags behind India, China, and Vietnam.
Competitive Response Underway
To counter the trend, Bangladesh’s Ministry of Commerce has launched a multi-year RMG modernization initiative targeting digital procurement platforms, green factory certification, and logistics corridor upgrades with support from the World Bank and Asian Development Bank. Yet implementation timelines remain uncertain: the first phase — covering 320 factories across Dhaka and Gazipur — is scheduled for completion by Q4 2027. According to Golam Mowla, the article’s author and senior business correspondent at Dhaka Tribune, “The window for structural recalibration is narrowing — especially as EVFTA and the pending EU–India FTA reshape tariff landscapes in real time.”
Source: dhakatribune.com
Compiled from international media by the SCI.AI editorial team.
