Bangladesh remains at the top
According to a recent report by McKinsey & Company, a global management consulting firm, Bangladesh is slated to remain the top sourcing nation for global retail of readymade garments (RMG) for the next five years. It is estimated that the growth of RMG sector in the stated time period will grow at an average of seven to nine percent per annum with Vietnam and India trailing at second and third positions. The report is based on the feedback collected from 40 chief purchasing officers of the top 40 international garment retailers during January and February of this year.
With more than six out of the respondents saying that they intend to increase, not decrease, their orders from Bangladesh over the next five years, the RMG sector in the country is looking forward to years of robust growth. This growth comes primarily at the behest of China, the global leader, which has witnessed the gradual loss of its competitive edge with the rise in labour costs. This is reflected in the fact that 75 percent of the respondents said they intended to decrease their allocation to Chinese firms over the next five years. The fact is that more and more Chinese RMG manufacturers are looking at foreign destinations such as Cambodia, Vietnam and Myanmar to relocate their production facilities. We should be taking a closer look at the opportunities provided by an expanding Chinese middle class as China, by the sheer size of population, is a massive market to cater for.