BanglaBhoot
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Orders diverted from China shield RMG industry
Kazi Azizul Islam
Many EU and US importers, who had earlier sourced apparels mostly from China, are diverting a part of their orders to Bangladeshi suppliers which protects Bangladeshs garment industry from adverse impacts of the current depression in the western markets.
Industry people, however, said all US and EU apparel importers, hit hard by financial crisis, are pressuring for price cuts. So, they urge the government to make a contingency support package.
They pointed out that Indian suppliers, backed up by huge devaluation of their currency, are trying to allure more and more orders form the US and EU importers.
Significant diversions of orders from China and elsewhere in the recent weeks have been a boon for the Bangladesh garment manufacturers, said Zulfiqure Ali Turaz, a senior executive of Synergies, a top buying house.
Even if the recent decline in apparel sales in EU and US markets has resulting in a 10 per cent reduction in orders from those markets, on the other hand at least 20 per cent additional orders have been being diverted from China and elsewhere to Bangladesh in the recent weeks, Zulfiqure said citing a random poll he has conducted.
Industry sources said many giant retailers including Wall Mart, VF Corporation and Carrefour hinted at increasing procurement from Bangladesh in the coming days.
Ghulam Faruk, chairman of SQ Group, a leading exporter of sweaters, said recently he received $10 million worth of fresh orders from EUs top retailer H&M, adding those orders earlier had been bagged by Chinese suppliers.
Some exporters are also receiving orders diverted from Indonesia and Sri Lanka, Ghulam Faruk said, pointing out that a growing uncertainty regarding continuation of duty- and quota-free market access of Sri Lanka under the GSP might be making new groups of EU importers turning to Bangladesh.
He said, Some Sri Lankan entrepreneurs are even considering relocation of their factories in Bangladesh to avail GSP facilities.
Bangladesh exported $10.7 billion worth of readymade garments, including $5.5 billion worth of knit wears, in 2007-2008. The industry has projected a 16 per cent export growth in the current fiscal.
The Bangladesh Garment Manufacturers and Exporters Association and the Bangladesh Knitwear Manufacturers and Exporters Association said they had processed satisfactory volumes of orders in September and October.
Leaders of the two associations admitted that they were informed of diverting orders, which they termed a blessing for Bangladeshs garment industry in this period of recession in EU and US markets the major destinations of made-in Bangladesh garments.
We are tracing swelling orders for trousers, especially from the US buyers, and sweaters from EU importers, BGMEA president Anwar ul Alam Chowdhury Parvez told New Age.
Citing a US Commerce Department data Anwar said shipment of cotton trousers, including jeans, from Bangladesh to USA had increased by 25 per cent in January-October this year compared to the same period in 2007.
In the past two years, Bangladeshi suppliers have again proved that they are highly competitive and efficient in managing large size of orders. The resulting confidence in Bangladeshi suppliers is wooing new groups of buyers to this country, who had earlier been used to source apparels mostly from China.
But, one thing that makes us worried now is the strong taka, Parvez said, arguing that with the value of Euro and pound sterling against dollar declined much in the recent months, many EU importers were pressing for further and further price cut.
Knitwear manufactures have also received increased orders in September and October, although those are not at par with the robust increases in the previous few months, said BKMEA president Fazlul Hoque.
He, however, sounded cautious, saying, For assessing the real impacts of the recession on Bangladeshs garment suppliers, the industry has to wait until early January.
According to him, the industry will be in a position to assess the impacts of the current economic volatility after the Christmas sales are over and fresh orders start to come in.
The diversion of orders to Bangladesh has also been scanned by suppliers of apparel raw-materials in Pakistan, as reported by the Business Recorder, a leading business daily of the country. The report quoted Karachi Cotton Exchange president Ghulam Rabbani as saying that More and more EU and US garment orders are diverting to Bangladesh; so Pakistani cotton and yarn suppliers desire to capture more market there.
He urged the authorities concerned to develop a direct shipping service with Bangladesh, as transit shipment requires Pakistani cotton or yarn exporters to spend at least $700 on a container.
http://www.newagebd.com/2008/nov/13/busi.html
Kazi Azizul Islam
Many EU and US importers, who had earlier sourced apparels mostly from China, are diverting a part of their orders to Bangladeshi suppliers which protects Bangladeshs garment industry from adverse impacts of the current depression in the western markets.
Industry people, however, said all US and EU apparel importers, hit hard by financial crisis, are pressuring for price cuts. So, they urge the government to make a contingency support package.
They pointed out that Indian suppliers, backed up by huge devaluation of their currency, are trying to allure more and more orders form the US and EU importers.
Significant diversions of orders from China and elsewhere in the recent weeks have been a boon for the Bangladesh garment manufacturers, said Zulfiqure Ali Turaz, a senior executive of Synergies, a top buying house.
Even if the recent decline in apparel sales in EU and US markets has resulting in a 10 per cent reduction in orders from those markets, on the other hand at least 20 per cent additional orders have been being diverted from China and elsewhere to Bangladesh in the recent weeks, Zulfiqure said citing a random poll he has conducted.
Industry sources said many giant retailers including Wall Mart, VF Corporation and Carrefour hinted at increasing procurement from Bangladesh in the coming days.
Ghulam Faruk, chairman of SQ Group, a leading exporter of sweaters, said recently he received $10 million worth of fresh orders from EUs top retailer H&M, adding those orders earlier had been bagged by Chinese suppliers.
Some exporters are also receiving orders diverted from Indonesia and Sri Lanka, Ghulam Faruk said, pointing out that a growing uncertainty regarding continuation of duty- and quota-free market access of Sri Lanka under the GSP might be making new groups of EU importers turning to Bangladesh.
He said, Some Sri Lankan entrepreneurs are even considering relocation of their factories in Bangladesh to avail GSP facilities.
Bangladesh exported $10.7 billion worth of readymade garments, including $5.5 billion worth of knit wears, in 2007-2008. The industry has projected a 16 per cent export growth in the current fiscal.
The Bangladesh Garment Manufacturers and Exporters Association and the Bangladesh Knitwear Manufacturers and Exporters Association said they had processed satisfactory volumes of orders in September and October.
Leaders of the two associations admitted that they were informed of diverting orders, which they termed a blessing for Bangladeshs garment industry in this period of recession in EU and US markets the major destinations of made-in Bangladesh garments.
We are tracing swelling orders for trousers, especially from the US buyers, and sweaters from EU importers, BGMEA president Anwar ul Alam Chowdhury Parvez told New Age.
Citing a US Commerce Department data Anwar said shipment of cotton trousers, including jeans, from Bangladesh to USA had increased by 25 per cent in January-October this year compared to the same period in 2007.
In the past two years, Bangladeshi suppliers have again proved that they are highly competitive and efficient in managing large size of orders. The resulting confidence in Bangladeshi suppliers is wooing new groups of buyers to this country, who had earlier been used to source apparels mostly from China.
But, one thing that makes us worried now is the strong taka, Parvez said, arguing that with the value of Euro and pound sterling against dollar declined much in the recent months, many EU importers were pressing for further and further price cut.
Knitwear manufactures have also received increased orders in September and October, although those are not at par with the robust increases in the previous few months, said BKMEA president Fazlul Hoque.
He, however, sounded cautious, saying, For assessing the real impacts of the recession on Bangladeshs garment suppliers, the industry has to wait until early January.
According to him, the industry will be in a position to assess the impacts of the current economic volatility after the Christmas sales are over and fresh orders start to come in.
The diversion of orders to Bangladesh has also been scanned by suppliers of apparel raw-materials in Pakistan, as reported by the Business Recorder, a leading business daily of the country. The report quoted Karachi Cotton Exchange president Ghulam Rabbani as saying that More and more EU and US garment orders are diverting to Bangladesh; so Pakistani cotton and yarn suppliers desire to capture more market there.
He urged the authorities concerned to develop a direct shipping service with Bangladesh, as transit shipment requires Pakistani cotton or yarn exporters to spend at least $700 on a container.
http://www.newagebd.com/2008/nov/13/busi.html