Europe Weakness Drags Bangladesh Apparel Exports as US Market Holds Steady

Bangladesh’s ready-made garment (RMG) exports declined during the first eleven months of fiscal year 2025-26 as softer demand in Europe and several non-traditional markets offset stable performance in the United States and modest growth in Canada and selected emerging economies.

According to the latest data released by the Export Promotion Bureau (EPB), Bangladesh exported apparel products worth $35.31 billion during July-May FY2025-26, marking a 3.41% decline from $36.56 billion recorded in the corresponding period of the previous fiscal year.

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The latest figures highlight the challenging global trade environment facing the world’s second-largest apparel exporter, with inflationary pressures, cautious consumer spending and heightened competition continuing to affect sourcing decisions among international retailers.

The European Union remained Bangladesh’s largest apparel destination, accounting for 49.15% of total garment exports. However, shipments to the bloc fell by 4.88% year-on-year to $17.36 billion from $18.25 billion in the same period a year earlier.

Germany retained its position as the largest European market for Bangladeshi apparel, although exports to the country dropped sharply by 12.71% to $3.99 billion. France, another major destination, recorded a 9.90% decline, with imports from Bangladesh falling to $1.81 billion.

Italy, traditionally one of Bangladesh’s strongest markets in southern Europe, registered an 8.56% decrease to $1.31 billion, while exports to Belgium declined 6.14% to $475.61 million.

Despite the overall weakness in the region, several European markets posted positive growth. Exports to Spain increased by 4.07% to $3.29 billion, making it the second-largest market within the European Union after Germany. The Netherlands recorded a 2.13% increase to $1.97 billion, while exports to Poland rose by 7.98% to $1.68 billion.

Also Read: Bangladesh Garment Exports Fall 3.4% in FY26 Despite Strong Start

Industry analysts say the mixed performance indicates that although consumer demand in Europe remains subdued, Bangladesh continues to benefit from changing sourcing strategies adopted by retailers seeking competitive and diversified supply chains.

The United States, Bangladesh’s second-largest apparel market, remained remarkably stable despite continued uncertainty surrounding retail sales and consumer spending.

Exports to the U.S. totaled $7.03 billion during July-May FY2025-26, accounting for 19.90% of Bangladesh’s total RMG exports. Shipments to the market were virtually unchanged from a year earlier, registering a marginal decline of only 0.04%.

The resilience of the U.S. market provided some relief for exporters, particularly at a time when many European economies continue to experience weak consumption and slower economic growth.

Canada emerged as one of the few major developed markets to record positive growth. Apparel exports to the country rose by 2.27% to $1.23 billion, increasing Canada’s share to 3.47% of Bangladesh’s total garment exports.

Meanwhile, exports to the United Kingdom declined slightly by 0.50% to $4.02 billion. The UK remained Bangladesh’s third-largest single-country market, accounting for 11.38% of total apparel exports.

Performance in non-traditional markets was less encouraging. Exports to these destinations declined by 5.95% to $5.68 billion, representing 16.09% of total RMG shipments.

Among the major setbacks, exports to Russia plunged by 30.36% to $218.17 million, reflecting ongoing geopolitical and economic challenges. Shipments to Turkey fell by 16.60% to $359.39 million, while exports to Australia, one of Bangladesh’s key markets in the Asia-Pacific region, dropped 10.09% to $682.59 million.

India also witnessed a notable decline, with exports falling 11.13% to $537.43 million. Shipments to Japan decreased by 6.58% to $1.04 billion, while exports to South Korea dropped 11.72% to $349.62 million. Mexico registered a decline of 12.94%, with export earnings standing at $268.92 million.

However, several emerging markets delivered strong growth, underlining the potential benefits of continued market diversification.

Exports to Brazil increased by 17.80% to $186.35 million, while shipments to China rose 15.07% to $233.54 million. Saudi Arabia posted a 17.04% increase to $178.66 million, supported by rising demand from the Gulf region.

Malaysia recorded growth of 14.59%, with exports reaching $203.53 million, while shipments to the United Arab Emirates climbed 13.17% to $245.51 million. South Africa also posted positive growth of 5.38%.

Within the product categories, both knitwear and woven garments experienced declines.

Knitwear exports, which account for more than half of Bangladesh’s apparel shipments, fell by 4.26% to $18.78 billion from $19.62 billion a year earlier. Woven garment exports declined by 2.42% to $16.53 billion from $16.94 billion.

The sharper decline in knitwear reflected weaker demand across several major markets, particularly in Europe, where economic uncertainties and high living costs have prompted consumers to curb discretionary spending.

The latest export figures underscore the headwinds confronting Bangladesh’s apparel industry, including rising production costs, energy-related challenges and intensifying competition from regional sourcing hubs.

Nevertheless, the stability of the U.S. market and robust growth in a number of emerging destinations suggest that Bangladesh’s apparel sector continues to maintain its global competitiveness.

According to EPB data compiled by former BGMEA Director Mohiuddin Rubel, the latest performance highlights both the resilience of Bangladesh’s RMG industry and the growing importance of market diversification as global sourcing patterns continue to evolve.

With one month remaining in FY2025-26, industry stakeholders will closely monitor order flows from major retailers to assess whether stronger shipments in June can help narrow the decline and provide momentum heading into the next fiscal year.