Apparel exports from Bangladesh to Japan have nearly doubled in last five years thanks to the entrepreneurs’ relentless efforts to meet Japanese quality requirements and the government’s support especially in bringing back their confidence in terms of security, industry people said.
They also attributed the rise in exports to Japan’s ‘China-plus policy’ and relaxation of its rules of origin though they believe that Vietnam and Myanmar are the gainers in taking the China-plus policy than Bangladesh.
Locally-made knit items have been enjoying duty-free facility in the Japanese market since April 01, 2015 and woven items since April 2011, even though the raw materials are imported, they added.
Garment makers are getting cash incentives at the rate of 4.0 per cent for exporting apparel to non-traditional markets, excepting the EU, the USA and Canada, officials said.
The country exported apparel items worth $826.26 million during July-March period of fiscal year of 2018-19, marking a robust 37.59 per cent growth over the corresponding period of last fiscal, according to data of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
The country fetched $626.68 million during July-May of fiscal year (FY) 2017-18. Apparel exports including knit and woven items fetched $ 846.74 million in FY 2017-18, up from $478.48 million in FY 2012-13. RMG export was only $74.33 million in FY 2008-09.
Overall exports reached one billion dollar mark in FY 2015-16 for the first time and maintained the same trend during the last three fiscal years, according to Export Promotion Bureau (EPB) data.
The country’s overall exports to Japan reached $1.13 billion while its import stood at $1.87 billion in FY 2017-18.
Local exporters, however, listed a number of issues as obstacles to exporting apparel items to Japan. These included Japanese buyers’ zero tolerance policy on quality, timely shipment and language.
“Japan has been consistently sourcing from us and their comfort level is steady, and therefore, they are continuing to source from Bangladesh and exports are on the rise,” BGMEA president Dr Rubana Huq told the FE.
Also their concerns about security have been addressed sufficiently and hence the level of confidence is back, she noted.
The BGMEA president, who is also in the delegation of Prime Minister’s current visit to Japan, expressed hope that the visit will help increase business between the two countries.
The Prime Minister met with the top CEOs of 25 Japanese companies where Japanese ministers, MPs, business delegates attended the meeting, she said.
The trade body has already requested Ambassador Rabab Fatima to organise a separate sectoral meeting within next three months so that the export potential of Bangladesh to Japan can be optimised, BGMEA chief added.
“About 75 per cent of our export to Japan consists of garments. First three months (Jan-Mar 2019) of export to Japan has been $325 million. This indicates that the potential to export this year will be around $1.3 billion for RMG,” she added.
Myanmar is Bangladesh’s strong competitor in Japanese market and their export is higher along with higher value addition, she said, adding: “There is great potential to grow RMG export to Japan.”
Sharif Zahir managing director of Ananta Denim Technology Ltd said Bangladesh’s export has been increasing due to buyers China-plus policy though the growth is not as much as expected.
Vietnam and Myanmar are gaining much compared to Bangladesh, he said, stressing the need for exclusive marketing policy there to increase the exports further.
Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said the growth showed that local exporters are meeting the Japanese buyers’ requirements for quality.
“There is no denying that Japan is one of the most important and potential markets beyond traditional ones,” he added. It is also most promising export destination in Asia, he noted.
The size of apparel market in Japan is expected to reach over $ 90 billion by 2021, according to industry insiders.
Japan is the world’s third largest apparel importer and the fourth largest apparel market in the world after China, the USA and Germany, they added.
“Japanese buyers are very strict about the quality products where they show zero tolerance as they check products piece by piece,” an exporter said.
It takes time to develop business relations with the Japanese buyers as they want to know whether we can meet their quality requirements and make timely shipments, exporters said, adding that language is another barrier to making direct relationship with the Japanese buyers.
As a result, local entrepreneurs get orders through their nominated agents, they added.
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