RMG Exports In 2018
World economic events turn boon for Bangladesh, Vietnam
For global trade and industry, particularly textiles and apparel, 2018 turned out to be a very happening year, that boosted exports from Bangladesh, Vietnam and some other readymade garment manufacturing countries.
The 10 different happenings included, imposition of import by US President Donald Trump, Brexit uncertainty in the United Kingdom, the signing of the Economic Partnership Agreement (EPA) by the EU and Japan has, opening up of Chinese economy and the signing of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
It also included a number of steps taken by the Indian government to boost the country's textiles and apparel industry to become the largest free trade area across the globe, the signing of the African Continental Free Trade Area (AfCFTA) among 49 African nations. It also included rising of minimum wage in apparel exporting countries like Bangladesh, Cambodia and Myanmar and also increasing of the cost of production in these countries.
The happenings also included introduction of modern forms of cotton and textile production by the government in Uzbekistan and the strict monitoring environment in China.
In Bangladesh, the second-largest garment exporter after China, minimum wage increased from Tk5,300 ($63.21) to Tk8,000 ($95.41) with effect from December 1.
United States (US) President Donald Trump's decision of imposing duties on goods of other countries with which it has a negative trade balance, undoubtedly, had the maximum impact on the textiles and apparel industry worldwide in 2018.
The US decision forced many textiles and apparel exporting nations to rethink, and be ready with an alternative strategy in case their exports to the US dwindle. As experts focused on pros and cons, especially the US-China trade war, some nations like Bangladesh and Vietnam saw in it an opportunity to boost their exports to the US.
The year also saw the US signing a revised free trade agreement with South Korea as also the United States-Mexico-Canada Agreement (USMCA), a rechristened version of the North American Free Trade Agreement (NAFTA).
Throughout the year, Brexit remained a point of discussion, over whether common rates would apply for goods entering the European Union (EU) and the United Kingdom (UK) or not. In November, 27 members of the EU approved the British withdrawal and future ties, insisting that it is the "best and only deal possible," paving the way for an "orderly withdrawal."
However, the year ended inconclusively on the issue, as the British Parliament is yet to ratify the deal concluded by Prime Minister Theresa May with the EU.
The International Monetary Fund (IMF) and Moody's have warned that a no-deal Brexit would entail substantial costs for the UK. The Bank of England (BoE) has said that the UK may suffer an even bigger hit to its economy than during the global financial crisis 10 years ago if it leaves the EU in a worst-case Brexit scenario.