RMG exports to Europe surge, to US sag

19 Aug '10

2 min read

The European Union market has become a new potential destination for exports of Nepal made clothing. A special trade facilitation offered by the European Union is encouraging the garment exports of Nepal, at a time when shipments to the US have not witnessed growth.

Nepal is availing a benefit in textile, garment and sugar export to Europe through the Duty Free Derogation facility that EU offered to 41 Least Developed Countries (LDCs). As per experts, garment export from Nepal to Europe is quite stable than those to the US.

Data reveals that, garment export to Europe has gone up by over 20 percent, while to the US, growth has been negligible. The country did not make any apparel shipments in the months of June and July.

Total garment exports to America from 2004-05 to 2007-08 has witnessed steep fall, while exports to Europe are stable, as per the export data of Trade and Export Promotion Center.

Previously, garment exports from Nepal to US were accounting for 90 percent of overall RMG exports and to Europe it was just 10 percent. But now, the RMG export scenario has totally changed.

The duty free derogation facility offered by Europe will end in 2010 and hence, a letter to extend facility by more than two years has already been forwarded by the Garment Association of Nepal (GAN). The country has been availing the facility since 2004, and this Duty Free Derogation has to be updated every two years.

Fibre2fashion News Desk - India

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