RMG exports to US may face setback

US ban on inputs from Xinjiang

| Updated: June 26, 2022 16:01:20


Country's apparel export to the United States may face a setback due to an import restriction by the US authorities on goods having any link to Xinjiang region of China, industry insiders feared.

The new law enacted by the US aims at preventing goods made by forced labour in China from entering into the country. It also imposed restrictions on goods made of raw materials having links to Xinjiang.

Citing the law, the industry insiders said the goods made with forced labour would be stopped at the US border and, the importers and manufacturers have to show required evidence that their supply chains don't use Xinjiang cotton or other raw materials produced with cotton imported from the Xinjiang region.

The concern surfaced as Bangladesh Garment Buying House Association (BGBA) has recently asked its members to be cautious about sourcing raw materials imported from the Xinjiang region.

The BGBA instruction came after its leaders on Thursday last met a delegation that apprised of the restriction by the US, Bangladesh's single largest export destination.

Tim Armstrong and Reza Patwary, who are conducting a regional assessment on behalf of the Indo Pacific Opportunity Project implemented by International Development Group and funded by USAID, met BGBA president Kazi Iftekher Hossain and general secretary Aminul Islam, according to a BGBA statement.

The delegation informed the BGBA leaders that any garment produced in Bangladesh could not enter the USA if it is produced from imported fabric using the cotton of Xinjiang, it said.

"The products will be seized if any connection to Xinjiang cotton is found," it said, adding exporters would not get their payments against their shipped goods if seized.

They also held a meeting with the Bangladesh Textile Mills Association (BTMA).

When asked, BGBA president Mr Hossain said the members have been requested to follow all the required procedures before importing fabric from China to avoid the US restriction.

When asked, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Fazlul Hoque, however, said it might not affect the country's readymade garment exports to the USA as the buyers are strictly monitoring the issue.

Besides, many of them have already developed alternatives to source yarn and fabric, he said, adding that the knitters source yarn and fabric from the local market.

"But the woven sub-sector that meets the majority of its demand for fabric through import might face some challenges," he noted.

Talking to the FE, Monsoor Ahmed, additional director and chief executive officer (in charge) of BTMA, claimed that the country's textile millers do not import cotton from the Xinjiang province.

He also claimed that the spinners would not face any challenges as they import raw cotton mostly from African countries, India and US.

But garment exporters especially that of woven makers might face challenges as they source fabric mostly from China, he added.

Mahmud Hassan Khan, a director of Bangladesh Garment Manufacturers and Exporters Association, however, opined that the issue might not affect their business, saying that the restriction is limited to only one province.

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