Bangladesh’s ready-made garment (RMG) exports to the European Union declined during the first 11 months of fiscal year 2025-26, reflecting continued weakness in demand across the country’s largest export destination despite a notable recovery in May.
According to data from the Export Promotion Bureau (EPB), apparel exports to the EU reached $17.36 billion during the July-May period of FY26, down by $640 million from the corresponding period of the previous fiscal year.
The decline follows a strong performance in FY2024-25, when garment exports to the bloc rose 9.1% year-on-year to $19.71 billion. Industry stakeholders, however, noted that much of that growth was driven by higher product prices rather than increased order volumes.
May Recovery Offers Temporary Relief
Garment exports to the EU increased to $1.82 billion in May from $1.52 billion in April, registering a 19.6% month-on-month growth. The figure marked the second-highest monthly export earnings of the fiscal year after January’s $1.88 billion.
Despite the rebound, export performance remained subdued for much of the year. Shipments declined from $1.98 billion in July to $1.34 billion in September and later fell to $1.35 billion and $1.33 billion in February and March, respectively.
EPB Director Alamgir Hossain said the contraction was more severe during the early months of the fiscal year but recent data suggest gradual improvement.
“The EU market has started showing signs of recovery in recent months. If demand conditions remain stable, we expect the positive momentum to continue through the remainder of the fiscal year,” he said.
Germany Retains Top Position
Germany remained Bangladesh’s largest apparel market within the European Union.
Exports to Germany rose to $409.3 million in May from $316.2 million in April. However, shipments remained below the fiscal year’s peak level of $471.8 million recorded in July, indicating that demand has yet to fully recover.
Germany accounted for approximately 22.5% of Bangladesh’s total garment exports to the EU during May.
Spain remained the second-largest destination, importing apparel worth $300.1 million, slightly higher than April’s $285.5 million.
Mixed Trends Across European Markets
Among other major EU destinations, exports to France increased to $190.1 million in May from $173.2 million in April, while Italy recovered to $139.9 million after several months of slower sourcing activity.
Exports to the Netherlands stood at $210.7 million, while shipments to Poland surged to $197.7 million.
In the Nordic region, Sweden recorded its highest monthly import volume of the fiscal year at $94.1 million, while Denmark’s imports increased to $82 million. Belgium remained stable at $51.9 million, and smaller markets such as Austria and the Czech Republic registered moderate growth.
Industry Concerned Over Prolonged Slowdown
Industry leaders said the sector continues to face significant challenges despite occasional signs of improvement.
Rakibul Alam Chowdhury, former vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said exporters have experienced negative growth for most of the past year.
“Global conflicts, persistent inflation and higher retail prices have weakened consumer purchasing power in major markets, resulting in lower sales and reduced apparel orders,” he said.
He also noted that competing sourcing countries have benefited from stronger policy support and incentive packages, while Bangladeshi exporters have struggled to maintain competitiveness under rising operational pressures.
Competition Intensifies
Taimur Rahman, Director of Mostafa Garments Industry, said uncertainty in the US market has prompted many international suppliers to shift their focus toward Europe, intensifying competition and putting downward pressure on prices.
He also highlighted operational challenges related to customs procedures and bonded warehouse regulations, arguing that existing systems are not sufficiently flexible to support growing demand for customised products and imported accessories.
Heavy Dependence on EU Market
The European Union continues to dominate Bangladesh’s export basket. In May, total exports to the bloc amounted to $1.97 billion, of which garments accounted for approximately 92%.
While the strong performance in May has provided some optimism, industry stakeholders caution that a single month of growth is insufficient to confirm a sustained recovery. They stress that improvements in consumer demand, policy support and export competitiveness will be critical to restoring momentum in Bangladesh’s largest apparel market.
