Abstract
Bangladesh is a medium-sized textile and clothing producer that, with very
competitive labour costs, is
rapidly moving up the world ranking. BMI
ranks the country number 24 in the world according to our
estimate of
value added in textiles and clothing (T&C) manufacturing. The total value of
industry exports
was over US$10bn in calendar 2008, according to our
estimates. While the next two years will be difficult
for the entire
industry, we believe Bangladesh may be able to use its competitive advantage
to come
through them with moderate to low output growth, at a time when
competitors are looking at outright
industry contraction. The
country’s strength in the ready-made garment (RMG) sector speaks of
a
promising medium- to long-term future.
We estimate that Bangladeshi
textiles and clothing manufacturing value added grew by 7.8% in 2008, and
will slow down in 2009 with growth of only 5.7%. Thereafter it will begin a
recovery with predicted
growth of 6.4% in 2010. In the five years to 2008,
BMI estimates that average annual growth of
manufacturing value added was
6.6%, ahead of GDP at 6.3%. In the next five years, we see the pace of
growth holding at 6.6%, ahead of GDP at 6.2%. BMI expects textile and clothing
export growth to fall to
7.7% in 2009 (to US$13.82bn), with import growth
easing to 9.7% (to US$3.1bn). Export growth, which
averaged 16.4% in the
five years to 2008, should reduce to 11.4% in the five years to 2013.
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