Apparel shipments from Bangladesh rose 15.9 per cent in July 2018 compared to July 2017. This was the fifth consecutive month of a double-digit increase in Bangladeshi apparel exports. The country has benefited from its low labor costs, by contrast with the jump of production costs experienced in other Asian countries. Duty-free access to the European Union is another decisive advantage for Bangladesh. Sales to the EU have therefore surged in the first half, especially in knit clothing categories where rules of origin are more easily met for benefiting from the duty-free access.

The development of a strong yarn industry in Bangladesh is favoring duty-free sales to European countries. Exports to Germany have for instance gained 14.3 per cent in the last fiscal year in knit clothing categories. Shipments to the UK or Spain are also experiencing a double-digit growth.

Exports to the United States have also rebounded in the second quarter this year, thanks to a return of US buyers to cotton apparel. The recent jump of polyester prices in China, along with the loss of competitiveness of Chinese exporters, is another advantage for Bangladesh. The sharp rise of minimum wages as of next December in Bangladesh could however result in higher export prices and a lower export growth.