Bangladesh loses out as Cambodia, Vietnam capture China's apparel market share: RAPID
The study also warned that Bangladesh’s readymade garment exports to the European Union could decline by more than 43% after its graduation from the least developed country category if exports become subject to the EU’s most favoured nation tariffs.
Bangladesh is no longer the biggest beneficiary of China's shrinking share in the global apparel market, with Cambodia and Vietnam overtaking it in attracting orders over the past four years, according to a new study by Research and Policy Integration for Development.
The study also warned that Bangladesh's readymade garment exports to the European Union could decline by more than 43% after its graduation from the least developed country category if exports become subject to the EU's most favoured nation tariffs.
The findings were presented at a workshop organised by RAPID at the National Press Club in Dhaka yesterday (6 July).
Keep updated, follow The Business Standard's Google news channel
According to the study, China's share of the global apparel market fell from 26.33% in 2022 to 23.56% in 2025. However, Bangladesh failed to capitalise on the shift. Its global market share remained almost stagnant, slipping slightly from 11.67% in 2022.
During the same period, Cambodia's share rose from 3.34% to 4.26%, while Vietnam's increased from 8.57% to nearly 9%.
"Bangladesh is no longer the automatic beneficiary of orders shifting away from China, signalling a weakening position in the global apparel market," said RAPID Chairman Dr MA Razzaque while presenting the keynote paper.
The study showed that between 2015 and 2022, Bangladesh had been the biggest winner from China's declining dominance. During that period, China lost nearly 10 percentage points of global apparel market share, while Bangladesh gained 3.75 percentage points. Vietnam and Cambodia gained 2.46 percentage points and 0.90 percentage points respectively.
The trend changed after 2022. While China lost another 2.77 percentage points of market share between 2022 and 2025, Cambodia captured 0.90 percentage points and Vietnam gained 0.40 percentage points. Bangladesh's share, meanwhile, remained virtually unchanged.
Speaking to TBS, Razzaque attributed the slowdown to policy inconsistencies, an unfavourable investment climate, growing Chinese investment in Cambodia and Vietnam, and Bangladesh's limited capacity to produce man-made fibre and other high-value apparel products.
Industry leaders cited additional domestic challenges.
Fazlul Hoque, managing director of Plummy Fashions Ltd, said Bangladesh has failed to compete with regional rivals in attracting new business despite China's declining exports.
"For the past two and a half years, Vietnam, Cambodia and China have pursued aggressive marketing strategies, while Bangladesh has failed to do so," he told TBS.
He said high business costs, persistent energy shortages and elevated bank lending rates have weakened the country's competitiveness, discouraging new investment.
"We do not see signs of improvement in the near future," he added.
EU tariff risk after LDC graduation
The study also warned that Bangladesh's exports could face a sharp decline after the country graduates from the least developed country status if it fails to secure a preferential trade arrangement with the European Union.
According to the study, Bangladesh's total exports to the EU could fall by more than 36%, while RMG exports could decline by over 43% if the country becomes subject to the EU's Most Favoured Nation tariffs and competing exporters continue to enjoy duty-free access through free trade agreements.
The European Union currently accounts for about half of Bangladesh's roughly $48 billion annual exports.
Bangladesh now enjoys duty-free access to the European Union under the Everything But Arms scheme. However, this preferential treatment will expire after LDC graduation and the transition period unless a new trade arrangement is secured.
Meanwhile, key competitors such as Vietnam and India have already signed free trade agreements with the European Union, enabling them to export many apparel products at zero or preferential tariffs.
Without a similar agreement, Bangladeshi apparel exports could face Most Favoured Nation tariffs of up to 12%, significantly eroding the country's price competitiveness in its largest export market, the study said.
The workshop was attended by Information and Broadcasting Minister Zahir Uddin Swapon as the chief guest. RAPID Executive Director Dr M Abu Yusuf moderated the programme, while Economic Reporters' Forum President Doulot Akter Mala also spoke.
