Given the complexity of its nature, measuring a country’s risk in a micro point of view is one of

the accurate assessment models that includes the evaluation of a range of country’s
characteristics as they relate to a specific industry. While proposing a project for a particular
country, it is important for MNCs to know how sensitive the particular industry is to other
macroeconomic factors as it relates to the MNC or its project directly. Different characteristics or
attitudes of industries cause different opportunities or hindrance the project taken by MNCs.
Here, we will analysis the Textile industry for both the countries: Bangladesh and Malaysia.
Labor wages in Bangladesh is one of the lowest in the world. This low-cost environment of the
country has contributed towards the flourishing textile industry constituting 84.21% of the
country’s total export items. The textile industry in Bangladesh is undoubtedly playing a
prominent role in the economic environment and is the second largest textile producer in the
world. About 41 billion was generated by exporting textiles which the country aims to take up to
50 billion within 2030. The sector has seen an overall growth from 0.2% to 8.7% in recent years.
Bangladesh has the highest-rated LEED Platinum denim factory, knitting factory, washing plant,
and textile mill in the world. Over the last 20years the major exported textile products were shirts
4.16%, trousers 19.22% , jackets 14.64% , T-shirt 13.16% and sweaters 18.76%. The chances of
FDI is also potential in Bangladesh as the country is dependent on imported high-end fabric and
raw materials. In 2017, sector received a foreign investment worth $421.68 million, which is
15.70% higher than $364.44 million in 2016. According to the BGMEA, around TK 6,900 crore
has been invested in this sector and expecting to triples by 2022.

Total export earned, compared with Textile sectors Total export earned, compared with Textile sectors

However, in the past there have been several catastrophic incidents in this sector like Rana-plaza
collapse, Tajrin Fashion. Worker disputes over wages are still here prevalently. In addition ,
there are some other unfavorable factors energy shortages, adverse trade policies, government
unrest, inadequate incentives of expansion and importantly too much reliance on imports of the
raw materials which can be a threat to sustainability.

On the other hand, developing countries like Malaysia has been a worldwide competitor. It is the
world’s leading emerging country in terms of industrial growth and exports, as well as internal
infrastructure for commercial clothes trading – a thriving textile sector with a large number of
textile manufacturing enterprises. In 2015, Malaysia was among top ten export earners with a
value of 13.2 billion which then became 13.8 billion representing 1.7% Malaysia’s total exports.
Malaysian government played a key role by assisting export-oriented manufacturing in the textile
industry. Their government had also taken industrial master plan (IMP3) to boost the sector.
Currently, baby clothing, toddler clothing, casual wear, basics, formal dress, and other items are
all part of the apparel industry. Furthermore, during the last few years, the import of textile
materials from many nations in Malaysia has remained stable. In Malaysia, increased income and
customer confidence are propelling the garment industry forward. Many fashion designers there
are optimistic about the future and the country is becoming a burgeoning emerging fashion
capital.

Country’s imports from Malaysia in last 5 years

Malaysian textile export values

The textile manufacturing market share in Malaysia is

expected to increase by USD 2.35 billion from 2021 to
2026, and the market's growth momentum will accelerate
at a CAGR of 4.72%.

However, in recent time, due to the global energy crisis and the governments inclination towards
making Malaysia a knowledge-based economy rather than manufacturing-based economy the
lucrative potential scenario of the Malaysian textile industry might get hampered.