Bangladesh’s ready-made garment (RMG) industry is facing mounting pressure in the United States market as exports declined during the first half of 2026, while regional competitors Vietnam, Cambodia and Indonesia continued to strengthen their positions.
According to data released by the US Office of Textiles and Apparel (OTEXA), Bangladesh exported US$4.01 billion worth of apparel to the US between January and June 2026, representing a 5.58% year-on-year decline from US$4.24 billion in the same period of 2025.
The decline comes amid a broader contraction in US apparel imports, which fell 7.71% to US$35.08 billion during the first six months of the year. Industry leaders attribute Bangladesh’s weaker performance to slowing consumer demand, geopolitical uncertainty, and persistent domestic supply-side challenges.
Vietnam emerged as the largest apparel supplier to the US, surpassing China with exports valued at US$7.85 billion, posting 1.33% growth over the previous year. Cambodia recorded the strongest performance among major suppliers, with exports increasing 12.61% to US$2.13 billion, while Indonesia expanded shipments by 3.67% to US$2.33 billion, overtaking India.
China experienced the sharpest decline, with exports plunging 37.65% to US$3.57 billion, largely reflecting ongoing trade tensions and sourcing diversification by American brands. India’s exports also dropped significantly by 25.19% to US$2.12 billion.
Industry leaders say Bangladesh’s competitiveness is being eroded by multiple domestic constraints. Rising energy costs, inadequate gas and electricity supply, higher bank lending rates, and increasing labour costs have collectively raised production expenses and disrupted factory operations.
BGMEA President Mahmud Hasan Khan said Vietnam and Cambodia continue to enjoy competitive advantages through shorter lead times and stronger value-added manufacturing capabilities.
He noted that their proximity to China enables faster access to raw materials, while Vietnam has successfully attracted substantial Chinese investment—something Bangladesh has struggled to achieve due to infrastructure bottlenecks, policy inconsistencies and political uncertainty following the 2024 political transition.
He also pointed out that Indonesia has strengthened its position through greater production of man-made fibre (MMF)-based garments, an area where Bangladesh still lags behind.
A recent study by the US Fashion Industry Association (USFIA) further indicated that American apparel buyers are consolidating their supplier base to navigate supply chain disruptions, evolving trade regulations, rising tariffs and increasing logistics costs, intensifying competition among global sourcing destinations.
The latest trade data highlights the urgent need for Bangladesh to improve energy security, modernise infrastructure, diversify into higher-value apparel products, expand MMF production, and enhance overall competitiveness to maintain its position in the increasingly competitive global apparel market.
