The recent years’ factory accidents and communal or political issues have not been enough to dampen the spirits of Western brands, doing business with the Bangladeshi readymade garment industry. In fact, the country’s apparel export is booming.
According to recent figures, its $26 billion garment export sector has grown faster than what many had predicted.
Germany, which is the second largest single export destination for Bangladeshi garments after the US, has promised to lend support to the country’s garment industry to double its export volume. “We are cooperating with Bangladesh in many fields. We want to support Bangladesh in its endeavours to become a sustainable, compliant, social and profitable garment sector. There is a need for mutual understanding,” German Ambassador Thomas Prinz had said at a press conference in Dhaka recently, adding, “We are happy that Bangladesh is a reliable source of high-quality garment for Germany.”
Also Read – Germany to support Bangladesh double garment exports, says Thomas Prinz
Meanwhile, Swedish retail giant H&M has also, through an official statement, announced its plans to increase its sourcing volume from the country. “H&M has maintained good relations with Bangladesh over the past 30 years. We have a long term plans for Bangladesh. So we will continue business with Bangladesh,” Sustainability Manager of H&M in Germany Hendrik Heuermann reportedly said this to a group of Bangladeshi journalists, who visited his Hamburg office recently.
Also Read – ‘H&M to source more garments from Bangladesh’
In McKinsey’s global survey of leading apparel producers last year, it had predicted 7-9 per cent annual growth for the sector over the next five years.
Exports to the United States have also seen a 16 per cent annual rise in December. As per government data, Bangladeshi factories exported garments worth $9.3 billion between October and January, which is a 14 per cent increase from a year ago.
Atiqul Islam, one of Bangladesh’s biggest garment exporters, whose supply garments to brands of the likes of H&M and Wal-Mart, claims that his company has received a 15 per cent rise in orders.
Bangladesh as a country doing business in this sector has several advantages. It has the world’s lowest wages, after Myanmar and Sri Lanka, skilled workforce, and also the upper hand owing to China becoming less competitive in recent years. The minimum monthly wage for a garment worker in Bangladesh is $68, compared with about $280 in mainland China.
However, sustainability issues concerning factory accidents like those that arose from the 2013 Rana Plaza factory collapse and Western countries apprehension of doing business due to inadequate safety measures at the airport will continue to create problems for the garment industry until the government takes firm steps towards that goal. This will, in due course, hamper the morale of the exporters, and in turn the industry at large.
Also Read – Bangladesh Court orders mass arrests over Rana Plaza disaster
Owing to such issues, manufacturers face the brunt and are forced to operate with a very small profit margin. While some exporters have been forced to let go of some workers or give them the minimum possible wage, most have opted for automation.
