International Trade of Bangladesh

 

Md. Joynal Abdin
Founder & Chief Executive Officer, Trade & Investment Bangladesh (T&IB)
Executive Director, Online Training Academy (OTA)
Secretary General, Brazil Bangladesh Chamber of Commerce & Industry (BBCCI)

 

Bangladesh’s international trade has become one of the core engines of its economic transformation linking a large, export-oriented manufacturing base with fast-growing domestic demand for energy, industrial raw materials, machinery, and consumer inputs. For local and foreign importers and exporters, Bangladesh offers a distinctive mix: globally competitive production in selected sectors (especially apparel), a deepening supplier ecosystem, improving trade facilitation, and a steadily expanding set of regional and extra-regional market linkages alongside familiar challenges such as logistics bottlenecks, compliance requirements, foreign exchange cycles, and policy transitions.

 

In fiscal year (FY) 2023–24, Bangladesh’s total export earnings (goods plus services) were reported at US$ 44.47 billion (with services export earnings shown separately in the same EPB statistics).

 

1) Bangladesh’s Trade Profile in One View

Bangladesh is best understood as a manufacturing-export hub supported by large-scale imports of intermediate inputs (cotton, fabrics, chemicals), capital machinery, and energy. This structure creates strong opportunities for:

• Importers: sourcing from Bangladesh’s established export sectors and emerging value-added industries
• Exporters: supplying Bangladesh’s factories with raw materials, accessories, machinery, logistics, and industrial services

 

At the multilateral snapshot level, WTO-reported 2022 figures show Bangladesh’s merchandise exports (f.o.b.) and imports (c.i.f.) at US$ 54,695 million and US$ 88,234 million respectively, reflecting the economy’s high dependence on imported inputs and capital goods.

 

2) Recent Trade Dynamics: Exports, Imports, and the Trade Balance

Trade performance in Bangladesh is often best tracked through fiscal-year balance-of-payments and trade data. For FY 2024–25, reporting based on central bank data indicated import payments of US$ 64.35 billion and export earnings of US$ 43.96 billion, illustrating continued import intensity and a persistent merchandise trade gap.

In FY 2023–24, a widely cited Bangladesh Bank-based summary reported imports of US$ 63.24 billion and a trade deficit of US$ 22.43 billion, capturing the pressure points that matter most to traders: currency availability, lead times for L/C settlements, and pricing of imported inputs.

 

3) Export Structure: What Bangladesh Sells to the World

Apparel dominance and why it matters?

Bangladesh’s export basket is still heavily concentrated in ready-made garments (RMG). In FY 2023–24, one policy-oriented economic review reported total RMG export earnings of US$ 36.13 billion, with the apparel sector’s share of overall exports noted at 81.24% for that year.

 

For international buyers, this concentration is not only a “risk” but also a market advantage: deep capacity, mature compliance ecosystems, specialized logistics channels, and highly competitive unit economics in large-volume production.

 

Market positioning in global apparel trade

WTO-based reporting highlighted Bangladesh’s position in global clothing exports for 2023, noting clothing exports of US$ 38.4 billion and an estimated 7.4% share of the global clothing market (with discussion around differences between reporting systems).

 

Where Bangladesh exports

In calendar year 2024, one report on RMG export distribution indicated the EU held 50.34% of Bangladesh’s total RMG exports (by value in that report), reinforcing the importance of EU compliance, product safety rules, and sustainability requirements for exporters selling into Europe.

 

4) Imports: What Bangladesh Buys (and What That Means for Suppliers)

Bangladesh’s import demand is anchored in:

• Industrial raw materials (notably for textiles and manufacturing supply chains)
• Capital machinery (to expand and upgrade factories)
• Fuel and energy (to support industrial output and transport)
• Food and agricultural commodities (to stabilize domestic supply)

 

Trade developments also show Bangladesh actively managing sourcing diversification for major staples. For example, Bangladesh signed an arrangement to import 700,000 tonnes of wheat annually from the United States over five years an illustration of how strategic procurement can intersect with broader trade diplomacy and market access considerations.

 

5) Services Trade: The Quiet Lever Behind Competitiveness

Merchandise trade headlines dominate, but services shape real-world trade costs: shipping, freight forwarding, insurance, finance, ICT, testing/certification, and professional services. WTO member data reports Bangladesh’s commercial services exports at US$ 5,666 million (2022).

 

For a more recent development-style view, World Bank WITS (WDI-based) snapshots report Bangladesh’s service exports at about US$ 6.38 billion (2023) and service imports at about US$ 11.01 billion (2023)—figures that help traders think about where value leaks out of the supply chain and where local capability-building can reduce costs.

 

6) Trade Finance, FX Reality, and Payment Risk Management

For importers and exporters working with Bangladesh, trade finance mechanics are not a side issue they are operational reality. Key considerations include:

• L/C structuring (confirmed vs. unconfirmed, deferred vs. at sight), document alignment, and discrepancy risk
• FX cycles that can influence lead times for import payments and the pricing of export proceeds
• Counterparty risk controls such as export credit insurance, standby L/Cs, escrow arrangements (where feasible), and staged payments tied to inspection milestones

 

Macro conditions can also change quickly. For example, reporting on the overall balance of payments for FY25 indicated a return to surplus an external stability signal that can influence banking liquidity and settlement confidence in trade corridors.

 

7) Compliance and Market Access: What Actually Wins Orders

International buyers increasingly select suppliers based on “total compliance,” not price alone. For Bangladesh-related trade, common decision drivers include:

• Social & labor compliance and audit readiness (especially for apparel and labor-intensive sectors)
• Product standards and technical regulations (REACH-type chemical controls, labeling rules, safety standards)
• Rules of origin and documentation consistency to secure preferential treatment where applicable
• Sustainability proof (energy efficiency, water stewardship, traceability, and credible reporting)

 

Because Bangladesh is widely integrated into global sourcing, compliance maturity can translate into faster buyer onboarding, higher repeat orders, and better contract terms.

 

8) Logistics and Trade Facilitation: Cost, Time, and Reliability

Bangladesh’s competitiveness depends heavily on the practical flow of goods:

• Port and inland container logistics
• Lead time predictability for production + shipment
• Clearance efficiency and documentation discipline

 

For importers and exporters, the most important operational strategy is usually process control: a standardized document checklist, pre-shipment inspection protocols when needed, reliable forwarders, and proactive HS-code verification to prevent clearance disputes.

 

9) Diversification Beyond Apparel: Where Opportunity Is Building

While apparel remains dominant, Bangladesh’s trade opportunity set expands when buyers look at:

• Higher-value textiles (man-made fiber blends, technical fabrics, performance wear)
• Leather and footwear value chains (with compliance and environmental controls handled correctly)
• Light engineering and electrical goods (where quality systems and certification matter most)
• Agro-processing and foods (where SPS compliance, cold chain, and brand trust are critical)
• ICT-enabled services (a competitiveness lever that can also reduce supply-chain friction)

 

A practical way for foreign importers is to treat Bangladesh not as a single-sector source, but as a portfolio sourcing destination: one anchor category (e.g., garments) plus 1–2 adjacent categories that share supplier capabilities and logistics channels.

 

10) A Practical “How-To” Framework for Traders (Importer & Exporter)

A high-performing Bangladesh trade program typically includes:

1. Market mapping & supplier shortlisting (capacity, compliance, lead times, financial health)
2. Sampling + technical validation (spec sheets, lab tests, and packaging rules)
3. Contracting & payment architecture (Incoterms, QC milestones, penalty clauses, dispute mechanisms)
4. Production control & inspection (in-line + final inspections, carton marking, barcode/label checks)
5. Shipment & clearance readiness (HS verification, documents accuracy, buyer customs requirements)
6. After-sales and claim handling (defect resolution, credit notes, replacement shipments)

 

This approach reduces the two most common causes of avoidable loss in cross-border trade: documentation mistakes and expectation mismatches between buyer specifications and factory execution.

 

Closing Perspective:

For global importers, Bangladesh remains one of the most consequential sourcing economies especially where scale manufacturing and disciplined compliance meet competitive pricing. For Bangladeshi exporters, the next growth phase is increasingly about product upgrading, market diversification, services capability, and trust-building through quality and transparency.