![]() ![]() One of the reasons for Vietnam and Bangladesh narrowing down the gap in the ready-made garment sector is Vietnamese manufacturers producing diverse products. According to industry experts, the main reason for the low productivity of Bangladeshi garment workers is lack of training, low wages, lack of a proper work environment etc. In addition, according to the Asian Productivity Organization (APO) 2020, the per-worker annual productivity level in Bangladesh’s garment industry is USD 10,400, compared to Vietnam USD 12,600 and China USD 23,600 respectively. Whereas Vietnam has 1.5 million manpower less than Bangladesh. According to a report by The Financial Express, Bangladesh having a workforce of around 4 million, is producing and exporting the same amount of products as Vietnam. Vietnam is investing in education and skill development for workers to increase productivity. But how exactly has Vietnam narrowed the ranking gap with Bangladesh in the readymade garments sector? Reason Behind Vietnam Moving Ahead Skilled Workforce While Vietnam lags far behind Bangladesh in the field of readymade garment exports just over a decade ago, over the past decade, Vietnam has become one of the leading competitors in the sector. According to BGMEA officials, in the first six months of 2021, Bangladesh exported USD 18.80 billion worth of garments, compared to Vietnam’s exports of about USD 16.86 billion. In addition, more than USD 3.18 billion worth of orders were canceled.Īlthough Bangladesh’s RMG exports were severely affected by the epidemic in 2020, Bangladesh was able to regain its second position through export earnings between January and June 2021. According to a BGMEA source, the epidemic had a direct impact on 1,150 factories in the country’s RMG industry. Therefore, Vietnam was able to surpass Bangladesh in RMG exports for the first time in 2020. On the other hand, despite the lockdown, production and exports have not stopped in Vietnam. When the Bangladesh government announced lock down during the epidemic, all activities from school, college, offices, courts, all sorts of production activities and import-export were halted. One of the main reasons behind this is the impact of COVID-19 pandemic on global trading. According to the General Statistics Office of Vietnam and EPB, between July 2019 and June 2020, Vietnam’s RMG sector export earnings amounted to USD 30.94 billion, while Bangladesh’s RMG sector export earnings amounted to USD 28.82 billion. But in the fiscal year 2019-2020, with a much smaller workforce than Bangladesh, Vietnam ranked second for the first time, leaving Bangladesh behind. ![]() From 2015 to 2019, Bangladesh and Vietnam held 2nd and 3rd position respectively. ![]() However, in the following years, although the exports in the RMG sector of these two countries became more competitive, Bangladesh always remained ahead in terms of ranking. According to the World Trade Organization’s International Trade Statistics 2011, Bangladesh ranked 5th on the list of global top exporters in the textile and clothing sector in 2010, while Vietnam ranked 7th. Which means, even a decade ago, Vietnam was lagging behind Bangladesh in the RMG sector. In 2010, Vietnam’s market share in the global RMG export market was 2.9%, while Bangladesh’s share was 4.2%. But how is Vietnam competing with Bangladesh to capture a large share of the global market? Overview of RMG On the other hand, Vietnam’s market share stood at 6.4 percent in the same year which was 6.2 percent in the previous year. According to the World Trade Statistical Review 2021, Bangladesh’s market share in the global garments market dropped to 6.3 percent in 2020 from 6.8 percent a year earlier. However, just within a span of a decade Vietnam, who had lagged behind in this sector previously, is now surpassing Bangladesh. Currently in the RMG sector, right after China, Bangladesh and Vietnam are in the leading position in terms of global export. ![]()
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