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China RMG factories eye joint ventures with Bangladesh

US-China trade war and the rising cost lead Chinese RMG factories to search joint venture in Bangladesh. They are finding Bangladesh as a competitive destination to relocate their units.

China joint ventures Bangladesh apparel sector
Figure: The trade war is providing a positive boom for the Bangladesh apparel sector.

Earlier, Chinese textile and garment industry owners have invested in neighboring Vietnam and Cambodia in the last two decades.

Charlie Yee, Vice President, Business Development of Peli Bio-Chem Technology Co. Ltd, said, “We believe Bangladesh has a long and bright future in textile and we are very optimistic because China is moving from this business.”

As uninterrupted electricity is needed for enzyme production, Peli Bio-Chem Technology (Shanghai) Co. Ltd wants to establish its production in Bangladesh after five years when the electricity condition will be improved.

Bangladesh is a competitive place compared to China, Vietnam and Cambodia for setting up industries because of the lower cost of production, trade privileges granted in major markets such as the EU and China.

They are interested to set up factories in fabrics, garment, printing, and dyeing as Bangladesh hasn’t allowed foreign investment in basic apparels, limiting their presence in high-end and value-added textile and garment items.

They are interested to set up factories in fabrics, garment, printing, and dyeing as Bangladesh hasn’t allowed foreign investment in basic apparels, limiting their presence in high-end and value-added textile and garment items.

A Chinese garment manufacturer, Robert Lok, Managing Director of Merit Tat International Ltd, recently said to a Bangladeshi daily newspaper that he was looking for a potential business partner in Bangladesh to make fresh order for his brand. He was part of the Hong Kong delegation.

“I have seen very young and energetic labor force in Bangladesh in the readymade garment sector. Their skill and the quality of work is really world class,” he said.

He believes, “If I manufacture here, the price will be cheaper than in China,” he said, adding that the Chinese garment industry might be affected by the ongoing trade war.

Lok plans to make fresh order with potential garment manufacturers in Bangladesh before deciding to relocate his factory.

According to Lok, Merit Tat International has office and owns outlets in New York and Western Europe where have a good number of Bangladeshi people and it is advantageous for the sector to manage workers.

Moreover, the wage of the workers is lower compared to Vietnam and Cambodia.

Chinese garment makers are impressed with Bangladesh’s garment factories as they have skilled workers and mature management, which will be helpful to relocate their manufacturing plant to Bangladesh.

They are talking to the garment manufacturers in Bangladesh and Bangladeshi counterparts have also shown interest.

However, there is a challenge of higher lead time in the garment sector in Bangladesh. If infrastructures are developed properly then lead time will become lower within a short period of time.

If anyone has any feedback or input regarding the published news, please contact: info@textiletoday.com.bd

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