Written by:
AKM SAYEDAD HOSSAIN
Executive Director
National Institute of Global Studies (NIGS),
A Bangladesh-based think tank
https://nationalinstituteofglobalstudies.com
In recent years, the United States has seen a significant shift in its apparel import landscape. China, traditionally the world’s largest exporter of garments to the U.S., has witnessed a steady decline in market share, primarily due to the ongoing U.S.–China trade war, international concerns over China’s human rights record, and rising production costs. This trend has opened up opportunities for other Asian nations, especially Bangladesh, to capture a larger share of the U.S. garment market.
From 2013 to 2023, China lost 16.4% of its apparel market share, while countries such as Vietnam, Bangladesh, India, and Cambodia have benefited from this shift. The U.S. International Trade Commission (USITC) attributes this decline to a combination of factors, including U.S. tariffs, human rights concerns related to the treatment of Uyghurs in China’s Xinjiang region, and increasing wages that have made Chinese products less competitive.
The trade war between the U.S. and China has had a direct impact on U.S. import patterns. Former President Donald Trump’s administration placed significant tariffs on Chinese goods, including textiles, aiming to level the playing field for U.S. manufacturers. The imposition of tariffs led many U.S. companies to seek alternative suppliers, particularly those in Southeast Asia, to mitigate the financial impact of higher import costs from China.
Further compounding this shift was the U.S. Congress’s passage of the Uyghur Forced Labor Prevention Act in 2022, which effectively banned goods produced using forced labor in Xinjiang. This legislation reinforced the need for the U.S. to diversify its supply chains, providing an additional incentive for American buyers to turn to other countries for garment imports.
Vietnam and Bangladesh: Key Beneficiaries of China’s Loss
Among the nations that have capitalized on China’s diminishing market share, Vietnam has seen the most significant gains. From 2013 to 2023, Vietnam’s share of U.S. garment imports rose from 10% to 17.8%, making it the second-largest exporter to the U.S. behind China. This growth was particularly pronounced between 2018 and 2019, during which Vietnam’s share of textile exports to the U.S. increased by over 4%, while China’s share shrank.
Bangladesh has been another notable beneficiary of this trend. The South Asian nation now holds 9% of the U.S. garment import market. Experts highlight that Bangladesh’s competitive advantage lies in its large, cost-effective labor pool, both skilled and unskilled, which is crucial for the ready-made garment (RMG) sector. Moreover, many factories in Bangladesh are compliant with international labor and environmental standards, particularly those required by Western markets, including the U.S., Europe, and the UK.
In addition to its labor force, Bangladesh’s garment industry has seen significant investments in infrastructure over the past decade. This focus on compliance with international standards has made Bangladesh an attractive alternative to China for U.S. buyers seeking dependable, ethical, and cost-effective suppliers.
Looking Ahead: Bangladesh’s Strategic Position
As the U.S. apparel market continues to evolve, Bangladesh stands to benefit further. According to Sayedad Hossain, Executive Director of the Bangladesh-based think tank National Institute of Strategic Strategies, Bangladesh is well-positioned to deepen its trade relations with the U.S. despite potential challenges posed by U.S. tariffs. Hossain suggests that Bangladesh could explore a reciprocal trade agreement with the U.S., offering tariff-free or reduced-tariff access to U.S. goods in exchange for more favorable access for Bangladeshi products in the U.S. market.
Currently, Bangladeshi garments face an average tariff of 15.7% when entering the U.S., which can make its products less competitive compared to those from countries with preferential trade agreements. Reducing these tariffs could significantly enhance the competitiveness of Bangladeshi exports, particularly in the RMG sector.
The Global Shift in Apparel Trade
The changing dynamics of U.S. apparel imports are a reflection of broader shifts in the global textile trade. As U.S. companies seek to diversify their supply chains in response to geopolitical tensions and rising production costs in China, other countries in South Asia and Southeast Asia are seizing the opportunity to increase their market share.
Vietnam and Bangladesh, in particular, have emerged as key players in this evolving landscape. Their ability to offer competitive prices, skilled labor, and compliance with international standards has positioned them as reliable alternatives to China. As the global trade environment continues to shift, both nations are likely to see continued growth in their garment exports, further solidifying their roles as major contributors to the global apparel market.
