Bangladesh is the largest cotton-based apparel exporter to the United Kingdom, grabbing over 21 percent of its market share in that particular category, according to the latest study report.
In 2021, Bangladesh exported cotton-based garments worth $1.95 billion having a 21.9-percent UK market share. On the other hand, China’s market share was 10.2 percent with $0.91-billion worth of exports.
Bangladesh is likely to earn $11 billion from ready-made garments (RMG) and $1.3 billion from non-RMG exports to the UK by 2030, according to the report.
Research and Policy Integration for Development (RAPID) chairman Dr MA Razzaque disclosed the statistics and projection at a discussion at the British high commissioner’s residence in Dhaka on Tuesday.
He presented the findings of the study done to determine best ways to boost, expand and promote exports from Bangladesh to the UK and help Bangladeshi exporters take advantage of the DCTS Scheme.
RAPID has identified four potential exportables-leather goods and footwear, agro and processed food, fish and shrimp, and light engineering products.
These four are among more than 100 non-apparel items as the most prominent products to unleash their export potential in the UK.
The UK has introduced its preferential trading scheme for developing countries, called DCTS, this year which marks its departure from the European Union’s Generalised System of Preference.
“Bangladesh is the second-largest exporter of overall apparel products to the UK and is the largest exporter in cotton apparel items,” said Mr Razzaque.
China’s share declined from 37 percent in 2010 to 21 percent in 2021, he added. On the other hand, Bangladesh’s share doubled to 14 percent during the same period. In cotton apparel, it has more than 21-per percent market share in the UK.
The study projected that Bangladesh’s apparel exports to the UK would reach $11 billion and non-RMG exports, now only $0.7 billion, reach $1.3 billion by 2030.
“But there is the potential for much higher non-RMG export growth in the UK that has highly diversified imports worth $688.2 billion,” noted Mr Razzaque.
In fiscal year 2022-23, Bangladesh fetched $5.3 billion from goods exports to the UK while 90 percent of the amount came from RMG items.
Its apparel export will reach $11 billion by 2030 under DCTS (Developing Countries Trading Scheme) of the UK as RMG export will continue to get duty-free access there.
Under the new scheme, according to Mr Razzaque, Bangladesh as an LDC enjoys duty-free market access through the DCTS Comprehensive Preferences.
Even after its graduation in 2026, the country will continue to enjoy the same LDC benefit for another three years until 2029, he noted.
Bangladesh will also get duty-free benefits on more than 85 percent of its UK-bound product lines under DCTS Enhanced Preferences.
It also stands to benefit from more generous UK rules-of-origin requirements as the minimum value-addition requirement for LDCs has been reduced to 25 percent from 30 percent in half of the chapter headings (48 chapters) defined at the HS two-digit level.
Speaking there, British High Commissioner Sarah Cooke explained the DCTS, saying that it was about boosting trade and prosperity.
The retention of DCTS is also based on respect for human and labour rights in compliance with international conventions, including those on civil and political rights, anti-corruption, climate change and the environment.
Stakeholders and leaders from RMG, leather, fish and shrimp, among others, also spoke there.
The study identified constraints and challenges, including lack of knowledge and information about the UK market, lack of integration with the UK’s supply chain, certification and standard requirements, and image of Bangladesh as a producer of quality products.
It suggested ways forward, including removing anti-export bias and rationalization of tariffs, deepening incentives for identified export sectors, globally recognized certifications and necessary testing facilities, and improving productive capacity for non-RMG sectors.