Bangladesh is now in third position, with China remaining the largest exporter, according to the latest figures from the World Trade Statistical Review 2021 released by World Trade Organization (WTO).
Vietnam’s clothing exports grew 6.4 % in 2020 with a market value of 29 billion dollars. Over the past decade Vietnam’s share in the global apparel export market surged, just ten years ago Bangladesh still had 85 % greater dominance, which in 2020 dropped form 6.8 % to 6.3 %.
The article outlined that Bangladesh output declined during the pandemic, with factories closed as many western brands cancelled orders or delaying payments.
Despite ongoing compliance issues forcing closures, Vietnam managed to diversify its production making not just low-end, fast fashion garments but also mid and high-end clothing and accessories, the article noted.
The article also underscored the importance of the Vietnam- European Union Free Trade Agreement (EVFTA), which has significantly boosted trading to the world’s largest bloc.
China remains the world’s largest exporter of RMG with 31.6 market share, despite a 7 % drop in 2020, valuing its exports at 142 billion dollars.
The article also stated several reasons that have made Vietnam become an attractive destination for apparel sourcing.
Accordingly, global companies have been reducing their reliance on China since the outbreak of COVID-19 pandemic. Much of Vietnam’s GDP growth has been driven by garment production and manufacturing, giving it a comparatively better infrastructure towards supply chains than countries such as India and Bangladesh.
In addition, Vietnam’s currency is also fixed in relation to the US dollar, so there is little price fluctuation when the market falls.
Moreover, Vietnam’s proximity to China is beneficial for sourcing raw materials and machinery for production. Some brands moving out of China will want to mitigate risk and stay close by distributing their supply chains.
Notably, Vietnam has maintained a more political stability than countries like Bangladesh and India with its citizens having access to better education infrastructure and healthcare.