Bangladesh's garment exporters registered the highest growth in shipments to the United States (US) in the just-concluded 2024-25 fiscal year, thanks to the shifting of work orders from other countries, mainly China.

Bangladesh shipped $7.54 billion worth of apparel to the US in the last fiscal year, posting a 14 percent year-on-year growth.

With the spike, the share of exports to the US in overall garment shipments edged up nearly one percentage point to 19.18 percent year-on-year in FY25, according to the Export Promotion Bureau (EPB).

"Many American buyers increased sourcing from Bangladesh in the last fiscal year after shipments from Vietnam got stuck. US trade tensions with China also made some buyers source from us," said Shams Mahmud, managing director of Shasha Denims Ltd, a leading apparel exporter.

In FY25, woven garments accounted for the majority of the shipments to the US, the single biggest market for Bangladesh. Exports of woven items grew 13 percent year-on-year to $4.94 billion in FY25.

But knitwear makers' exports soared 15 percent year-on-year to $2.59 billion during the period.

Overall, Bangladesh sent over $39 billion worth of apparel in FY25, posting nearly a 9 percent growth.

The European Union (EU) bought half of the garments sold by the South Asian country, the world's second-largest apparel exporter after China.

In FY25, garment exports to the EU expanded 9 percent year-on-year to $19.7 billion.

Within the EU market, where Bangladesh's goods get duty-free entry, Germany was the biggest destination, followed by Spain, France, and the Netherlands, according to EPB data.

Apart from the US and EU, the UK, Canada, and Japan were the largest markets for apparel in the last fiscal year.

Mohiuddin Rubel, managing director of Bangladesh Apparel Exchange, an initiative to promote local apparel and textiles, said that since the onset of Covid-19, the global landscape has taken unexpected turns, presenting a cascade of new challenges each day.

"Our performance remains robust in the traditional markets, boasting an impressive 84 percent share of our total apparel exports. However, the non-traditional market tells a different story, with our current stake standing at a modest 16 percent."

Exporters define the EU, US, UK, and Canada as traditional markets, while the rest—including Japan, Australia, and India—as non-traditional ones.

According to the EPB, Bangladesh's RMG exports to non-traditional markets increased 6 percent year-on-year to $6.44 billion in FY25.

Rubel said the US economy recovered faster than the EU. Besides, US purchases from China declined, which benefitted Bangladesh.

"We invested in factories and compliance. Now, a lot depends on the resolution of the tariff issue with the US," he said, referring to the government's negotiation with the Trump administration over its plan to impose a 35 percent tariff on Bangladesh's exports.

Mahmud said the worst-affected countries would focus on the EU markets because of Trump's tariffs.

"So, there will be a knock-on effect, and a price war may unfold in the EU market," he said. "In the US, consumer demand is likely to shrink due to the higher import cost. A price war is also likely in the American market."