|
‘ knowledge and skills embodied in individuals that enable them to create economic value ’ through education metrics , and by this measurement , Vietnam ’ s human capital eclipses even that of China .
On the other hand , Bangladesh faces a shortage of skilled labour , which is again reflected in its product offerings . Of Bangladesh ’ s total exports , a major percentage is concentrated in five basic products – trousers , T-shirts , sweaters , shirts and jackets . Without enough skilled labour , Bangladesh struggles to diversify production and manufacture more high-end garments . In contrast Vietnam , thanks to its skilled workforce , has found a market in diversification by producing lower volumes of higher quality and more technical garments that offset its comparatively higher labour costs with respect to Bangladesh .
An analysis of Bangladesh and Vietnam ’ s main exports to USA ( a major market for both the countries ) is an indicator of the same , besides also hinting at how the latter is now catching up with Bangladesh even in basic products . Vietnam ’ s main exports to USA in 2017 were
|
jackets and blazers ( US $ 1.3 billion approximately ), undergarments ( US $ 555 million approximately with growth rate of 1.12 per cent Y-O-Y ) and foundation garments ( US $ 321.5 million with growth rate of 113.67 per cent Y-O-Y ) while Bangladesh ’ s principal exports have been trousers ( US $ 2.37 billion ), T-shirts ( US $ 578.5 million ) and shirts ( US $ 588 million ). What ’ s more , Vietnam has now overtaken Bangladesh in these product categories ( T-shirts and trousers ) too in which it earlier held supremacy in the US market . As per US custom data , Vietnam ’ s export to USA in trousers was almost US $ 3 billion compared to Bangladesh ’ s US $ 2.37 billion in 2017 whereas in t-shirts , Vietnam shipped products worth US $ 3.33 billion to USA compared to Bangladesh ’ s US $ 578.5 million , during this period .
CPTPP : the game changer ?
Despite challenges and pressures from the abandonment of the Trans- Pacific Partnership ( TPP ) trade deal , Vietnam has been able to maintain its growth curve going . A report from Textiles Intelligence shows that the production capacity of the industry
|
FACT SHEET
Of Bangladesh ’ s total exports , a major percentage is concentrated in five basic products – trousers , T-shirts , sweaters , shirts , and jackets . Without enough skilled labour , Bangladesh struggles to diversify production and manufacture more highend garments . In contrast Vietnam , thanks to its skilled workforce , has found a market in diversification by producing lower volumes of higher quality and more technical garments that offset its comparatively higher labour costs with respect to Bangladesh .
|
is predicted to rise by 12-14 per cent per annum from 2016-2020 with export potential forecasted to rise by 15 per cent per annum during this period .
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership ( CPTPP ), also known as TPP11 ( Australia , Brunei , Canada , Chile , Japan , Malaysia , Mexico , New Zealand , Peru , Singapore and Vietnam ) officially signed in Chile on March 9 that will open new playgrounds with market size accounting for about 13.5 per cent of global GDP , according to experts , will be a great opportunity for Vietnam to boost its exports to the member countries .
Although CPTPP does not have the US market ( accounting for 48 per cent of exports in 2017 for Vietnam ), there are still other potential markets such as Australia , Canada , Japan ( considered highly-developed with immense business opportunities ), which are sure to play to Vietnam ’ s advantage .
As per World Bank estimates , CPTPP would help Vietnam ’ s gross domestic product increase by 1.1 per cent more by 2030 , while export turnover to CPTPP countries may increase to US $ 80 billion , or 25 per cent of Vietnam ’ s total export turnover . Of this , the important business fields of Vietnam , including food and beverage , footwear and textile and garment would see an export turnover increase by US $ 10.1 billion , US $ 6.9 billion and US $ 0.5 billion , respectively .
Also to be considered in this aspect is the Vietnam-EU Bilateral Trade Agreement ( expected to get finalised in 2018 ), which to a great extent would neutralise the advantage Bangladesh would enjoy once it qualifies for the GSP Plus status from the European Union bloc .
Keeping all these factors in mind , Bangladesh may not find it easy to maintain its dominance , more so when Vietnam is leveraging on a number of trade deals making it one of the potent candidates in the China Plus One scheme of things .
|