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Can Bangladesh weather Chinese "hurricane" of apparel exports front? |
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2004-7-8
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For Bangladesh and other apparel exporting countries it is China that has emerged as the biggest threat with the abolition of export quotas next January.
China with its current growth rate is expected to pick up to 75 percent US market share market according to a study by a US-based coalition of trade bodies.
Past 27 months have seen 794 percent rise in Chinese market share in the US, according to the study titled ''The China Threat to World Textile and Apparel Trade'' of the National Council of Trade Organisations (NCTO).
Till 2001, China had only nine percent share in the expanding US textile market in 2001, which rose to 65 percent in March this year, turn in a major threat for large apparel exporters like Bangladesh and India.
Bangladesh''s apparel export to the US market declined from seven percent in 2001 to only two percent by the end of March 2004 shows the NCTO market analysis. It is gradually losing its market share in 29 categories in the US market after abolition of quotas for these categories.
The country lost 34 million square metres in apparel export of 29 categories. Other major losers were Mexico (42 million square metres), Thailand (37 million square metres) and the Philippines (30 million square metres).
While Bangladesh and other apparel exporting countries lagged behind China in offering prices for most of the categories, China''s prices would witness a decline by 48 percent after quotas are removed on those items.
Bangladesh Garment Manufacturers & Exporters'' Association (BGMEA) President Annisul Huq said that China was a ‘real big threat’ for Bangladesh.
"But we can compete with China if our Chittagong port efficiency is increased, rules of origin is eased, central bonded ware houses are set up and yarn import through Benapole land port is allowed," he said.
"If the government takes initiatives in this regard, we can not only face the Chinese but can also increase our export volume," the BGMEA leader said.
According to Fazlul Hoque, President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Bangladesh has already lost 15 to 100 percent market share in 29 categories in the US market.
He alleged that China was dominating the world market, especially the US through ''foul play''. "In the Brussels summit we called for an emergency WTO meeting to find out ways to control the Chinese foul play as well as to face the challenges of quota free regime," Hoque stated.
The WTO meeting could allow an extension of the quota system or develop a new system or devise other mechanisms to face the challenges, the BKMEA chief said.
"We are capable of facing the challenges of post-MFA (multi-fibre arrangement) era, but our fear is Chinese control in the world textile and clothing trade," he said.
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