Bangladesh Apparel Exports to the EU Drop Across 15 Markets

Bangladesh’s ready-made garment (RMG) sector is facing mounting commercial pressure as export earnings across 15 of the 27 European Union member states registered a distinct downturn during the 2025–26 fiscal year.

Data released by the Export Promotion Bureau (EPB) and evaluated by industry trade bodies—including the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA)—reveals that overall apparel exports to the EU fell by 3.31 per cent. Total export receipts from the bloc dropped from $19.71 billion in the previous financial period to $1,906 crore ($19.06 billion). Consequently, the EU’s share of Bangladesh’s total global garment export revenues contracted from 50.10 per cent to 49.25 per cent.

Shift in Major European Destinations

The shortfall was heavily concentrated in Bangladesh’s most established European trade channels, whereas growth was limited to smaller or secondary regional markets.

• Germany: Retaining its position as Bangladesh’s largest European market and second-largest destination globally behind the United States, Germany recorded an 11.5 per cent reduction in orders. Total export value slid from $4.95 billion to $4.38 billion. Knitwear items (such as T-shirts and jerseys) suffered a 13 per cent drop to $2.68 billion, while woven items (such as shirts and trousers) contracted by nearly 10 per cent to $1.70 billion.

• France: In Bangladesh’s third-largest EU market, revenues fell by nearly 9 per cent, moving from $2.16 billion down to $1.97 billion. Within this figure, knitwear exports decreased by 11 per cent, whilst woven garments dropped by 5 per cent.

• Italy: Ranked fourth, shipments to Italy decreased by approximately 8 per cent, falling from $1.54 billion to $1.42 billion, driven primarily by a sharper drop in knitwear sales.

• Broader EU Declines: Denmark experienced a 10 per cent reduction, down to $940 million from $1.04 billion, whilst Ireland fell by over 10 per cent to $230 million. Romania registered the steepest fall at 20 per cent, slipping from $230 million to $180 million. Belgium decreased by nearly 5 per cent to $530 million, and the Czech Republic saw revenues ease to $310 million. Decreases were also logged in Portugal, Slovakia, Greece, Croatia, Finland, Luxembourg, and Malta.

Summary of Export Performance Across Affected EU Markets

Growth Outliers and Domestic Industry Analysis

Spain provided a notable exception to the general decline. As Bangladesh’s second-largest market within the EU, Spain generated a 6 per cent rise in imports from Bangladesh, climbing from $3.40 billion to $3.60 billion. Secondary gains were also recorded in the Netherlands, Sweden, Slovenia, Poland, Lithuania, Latvia, Hungary, Cyprus, and Bulgaria.

Explaining the disproportionate drop in knitwear exports across Europe, BKMEA Executive President Fazlee Shamim Ehsan highlighted that local value addition in knitwear production stands at roughly 90 per cent. Because a vast majority of the manufacturing process is handled locally, the sector is immediately vulnerable to domestic infrastructure constraints, including gas and electricity shortages, high commercial interest rates, and labor unrest.

Externally, international tariff realignments—notably additional US duties imposed under President Donald Trump—have squeezed global market dynamics. This has encouraged competing manufacturing hubs like China and India to reorient their export focus toward Europe, increasing price competition for Bangladeshi exporters already coping with elevated energy costs and higher local wage bills.