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The country's apparel manufacturers are planning to utilise the full potential of non-traditional markets amid a 35 per cent tariff recently imposed by the United States. 

Working on the market over the past few decades, manufacturers have said that nontraditional destinations also face multifaceted challenges, including tariffs. 

However, the recently announced US tariff triggered them to rethink the new markets, they added.

Speaking to ¶¶Òõ¾«Æ·, Mahmud Hasan Khan Babu, president of the Bangladesh Garment Manufacturers and Exporters Association, stated that they have been working to increase their exports for over 10 years.

‘However, as single market, each destination is comparatively small and there are also tariff-related and other challenges in those markets,’ he added.

Regarding apparel exports, countries such as the US, Canada, the UK, and the EU are considered traditional markets, while other countries are deemed non-traditional.

Japan, Australia, Russia, India, China, South Korea, the UAE, Malaysia, Brazil and Mexico are major non-traditional export destinations.

In the financial year 2024-25, export earnings from the non-traditional markets also experienced positive growth, with an overall rise of 5.61 per cent to $6.44 billion, up from $6.09 billion in FY24.

The non-traditional market represented 16.36 per cent of Bangladesh’s total RMG exports.

In FY25, Bangladeshi RMG manufacturers earned $7.54 billion from the US, the single largest destination of the country’s exporters. The earnings from the North American country accounted for 19.18 per cent of the total revenue.

Many insiders said that if exporters could export RMG items worth $10 billion to the nontraditional markets in the coming years, it could alleviate their overreliance on the US market, which has already become saturated and may be severely impacted by the tariff slump.

Inamul Haq Khan, senior vice-president of the BGMEA, told ¶¶Òõ¾«Æ· Bangladesh was doing well at most of the nontraditional market destinations.

‘However, we cannot lose the US market. We have to focus on the nontraditional markets by keeping our position in the US,’ he added.

He also stated that markets such as Japan, South Korea, Australia, the Middle East, and Latin America could be the game-changers in Bangladesh’s exports.

However, despite having significant growth potential and maintaining positive growth, the new markets faced challenges, including tariffs. 

‘Although we import cotton from Brazil with zero duty, our RMG products face 30 per cent-35 per cent tariff in the Brazilian market,’ said Mahmud Hasan Khan Babu.

He also stated that if they urged a duty waiver, Brazil would seek to export meat to Bangladesh, which is almost impossible given the current agricultural situation.

‘Japan is a big market but they primarily focus on near sourcing, meaning import from Vietnam and China,’ he added.

He also mentioned that there are some design and branding-related issues associated with exporting to the Middle East.

‘But Australia and South Korea are potential markets, though Latin America’s potential is very high. After resolving the US tariff issue, we would work on those of the Latin America,’ he added.

Meanwhile, according to World Trade Organisation data for 2024, Japan was the 3rd largest consumer of apparel items, while South Korea was fifth.

In FY25, Japan imported RMG items worth $1.18 billion from Bangladesh, followed by Australia $813.62 million and India $644.24 million. Moreover, RMG exports to Turkey and South Korea also witnessed significant earnings, amounting to $449.9 million and $411.46 million, respectively.

Some businesses are urged to adapt to the trends of the nontraditional markets to capture those.

Mohiuddin Rubel, former BGMEA director and managing director of the Bangladesh Apparel Exchange, told ¶¶Òõ¾«Æ· that Japan could be a potential market for Bangladesh.

‘In this regard, we should capture their fashion trends and to adapt with it. They primarily focus on fast fashion, high value and high quality and for these, we have to conduct proper research on them,’ he added.

He also said that the pricing capacity of Japan, Australia and Korea is high.

Talking to ¶¶Òõ¾«Æ·, Professor Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue, said that they had been advocating for market diversification for several years.

‘To address the challenges, shocks and adverse decision, Bangladesh must focus on market diversification along with products,’ he added.

The manufacturers stated that there are also some challenges in non-traditional markets, including payment issues with Russia, land port issues with India, and design issues in the Middle East.

To address these, they urged the exporters to focus on design studios, negotiations, research and development.

They also said that the country must focus on signing free trade agreements or preferential trading agreements with nontraditional destinations to smoothen export lines.