How can Bangladesh enhance its competitiveness as an outsourcing country for British retailers of ready-made clothing?

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TABLE OF CONTENTS

CHAPTER 1: INTRODUCTION1

Background of the study1

Problem Statement2

Purpose of the Study2

Aim3

Research Questions3

Scope and Significance of the Study4

CHAPTER 2: LITERATURE REVIEW6

History of Bangladesh Textile Industry6

The British Textile Market8

Overview of global textile trade15

The Agreement on Textile and Clothing (ATC)19

Bangladesh's garment Exports - A National Level Perspective20

Outsourcing and Competitiveness23

REFERENCES25

CHAPTER 1: INTRODUCTION

Background of the study

International trade in textile and clothing (textile) has been subject to strong protectionism for decades. Asian producers have influenced the world's textile and clothing industries for a long time. In the 1990s, this region experienced substantive growth in production and trade in the textile and clothing industries. Bangladesh, Taiwan, South Korea and China are the Big Four in the textile and clothing trades. They enhanced their production and marketing structures and had a major influence on global markets (Cline, 2008, 12). Among these four, Bangladesh has long been a favourite destination of operation for multinational corporations. Indeed, Bangladesh's reputation for its freewheeling way of doing business and its government's non-interventional policies are attractive to investors and buyers of the textile and clothing industries from all over the world (Towill, 2006, 277).

Since the end of the 1980s, firms in the Bangladesh clothing industry have faced challenges in the form of factory closures, employment reduction, lack of government support and decline in business performance. In addition, over the last ten years, changes in the business environment within the industry has become fierce, because developed countries have seen a drop in clothing prices, a trend that is likely to remain for some time (Anson 2005). Indeed, sales of clothing at discounted prices in the United States rose from 59.7 percent in 2001 to 64 percent in 2003. The decline in clothing prices has affected all segments of the market: the high, mid- and low ends (Hoppe, 2007, 126). Global textile trade patterns were expected to enter a new and ever-changing millennium after the abolishment of MFA quotas. With the multi-regional and sectoral nature of the global economy, computable general equilibrium (CGE) modelling was adopted in this study to quantify the probable impacts of textile trade liberalisation policies, based on an economy-wide perspective.

Problem Statement

Since modem global economies are characterised by multiple linkages between domestic input and output markets, any changes in macro-economic trade policies would have repercussions on the global economy and its various trade sectors. This highlights an increasing demand for quantitative policy analyses on a global scale. The trade liberalisation process has created huge uncertainty among producing countries and enterprises worldwide. Quantitative studies were undertaken to examine the impact of the ATC termination by employing various economic approaches or modelling techniques.

Purpose of the Study

The primary purpose of this research is to examine the trade pattern of textile industries, and evaluate the underlying determinants that influence the industries in question, with the aim of developing an extended gravity trade model for analyzing and explaining major determinants regarding textile and garment trade at the national, regional and global ...