Bangladesh’s RMG exports can hit $95 billion by 2030 if the country can expand its share of man-made fibers (MMF) in the global market from less than 5 percent currently to 12 percent along with the existing cotton-made items, according to a research paper.
Dr M A Razzaque, Chairman of Research and Policy Integration for Development (RAPID) disclosed these statistics in his paper at a workshop titled ‘Man-Made Fibre for Moving up the Value Chain of RMG in the Context of LDC Graduation’ – held in the city on Tuesday.
Bangladesh needs to achieve 12 percent and 20 percent of global MMF and cotton-based items market share respectively to export the said amount, it showed. Currently, Bangladesh occupies a market share of less than 5.0 percent and 16 percent of Global MMF-based and cotton-based apparel products respectively.
The research paper showed that in 2021, the global apparel market size was $440 billion, of which the MMF-based apparel market was $222 billion or 51 percent, and cotton-based was $190 billion or 42 percent. In contrast, Bangladesh exports are 72 percent cotton-based and only 24 percent are MMF based. Cotton-based apparel items accounted for $30 billion of Bangladesh’s total apparel exports of $42 billion last fiscal year, the study showed.
The workshop was jointly organized by Economic Relations Department (ERD), Support to Sustainable Graduation Project (SSGP) and Bangladesh Garments Manufacturers and Exporters Association (BGMEA) at the National Economic Council Auditorium in Dhaka.
The data showed that the global MMF apparel exports grew 4 percent while cotton-based items shrank 0.5 percent annually between 2011 and 2019. After that, cotton garment exports fell by around 15 percent in 2020 while MMF garment shipments grew by a robust 8 percent in 2021.
China has increased MMF apparel exports to 74 percent in 2021 of its total apparel shipment from 37 percent in 2010. Similarly, Vietnam increased MMF apparel shipments to 57 percent from 38 percent, India increased 32 percent from 15 percent and Cambodia 26 percent from 13 percent at the same time.
Global consumption of fiber is leaning heavily towards MMF and the move towards MMF could improve commodity prices. Now, about 30 percent of Bangladesh’s total fiber imports are MMF items. The country currently imports about 0.15 million tonnes of MMF, mainly from China. Hence, Bangladesh’s MMF backward linkage capacity needs to be developed and more investment is needed in the domestic MMF sector, he opined.
Planning Minister MA Mannan said the government is considering giving more cash incentives to MMF-based garment exporters as the garment sector is considered a strong component in meeting the challenges of LDC graduation.
