LONDON: Bangladesh All Party Parliamentary Group on Monday made report on the readymade garment industry in Bangladesh tiled ‘After Rana Plaza’ mentioning different aspects of the sector.
The report reads: “In the view of the All Party Parliamentary Group (APPG) for Bangladesh the Ready Made Garment (RMG) industry in Bangladesh is currently at a critical crossroads and in urgent need of reform to ensure its long term viability. The human costs of doing business in Bangladesh, as illustrated by the Rana Plaza collapse, combined with poor infrastructure and political instability are the most pressing challenges facing the industry. If Bangladesh is not to lose future investment in such a critical industry, all stakeholders must engage in dialogue together to address supply bottlenecks and rebuild the reputation of the industry by improving working conditions.
The RMG industry is a key driving force of Bangladesh’s economic development: in 2011-12 Bangladesh was the world’s second largest exporter of apparel and registered $19.1 billion of ready-made garment exports, a total which accounted for 13% of the country’s GDP. The industry currently provides employment for an estimated 3.6 million people and is predicted to be the fastest growing export industry over the next two decades. This growth is to be celebrated, but it is the concern of the APPG that the gains enjoyed at the national level are not evenly distributed and that the 3.6 million workers employed by the industry are labouring in precarious conditions.
On 24 April 2013 more than 1100 people died in one of the world’s worst industrial accidents. The collapse of Rana Plaza, an eight storey multiplex housing clothing factories, a bank, shops and several residential apartments in the Savar district of Dhaka, came just months after a fire in the Tazreen Fashions factory killed an estimated 112 workers. The collapse of the Rana Plaza factory has since become emblematic of the human costs of doing business in Bangladesh.
The rapid economic development and urbanisation that Bangladesh has experienced in the last few decades has led to strains on the ability of any government to meet infrastructural and regulatory need. GDP growth has been averaging 5-6% per year since the turn of the century and Bangladesh’s urban population has been growing by 6%; a trend that is expected to continue.
As a result, Bangladesh needs to be supported by brands and the international community in their efforts to build up local capacity and reform the RMG industry. The UK as one of the major investors in Bangladesh and the third largest export destination for Bangladeshi textiles has an important role to play in supporting such a process. The UK is already one of the largest grant donors to Bangladesh and the APPG recognises the substantial progress in this sector that has been achieved by the Department for International Development (DFID) and believes that DFID could further develop its programmes in Bangladesh. In the opinion of the APPG, sanctions are counter-productive as they threaten the future of the RMG industry without helping Bangladesh address the root causes of the problem. Nevertheless, as the World Bank recently stated, Bangladesh must act now or risk losing future investment and its favoured access to the EU which could see its total exports fall by as much as 4.1% to 8%1.
The APPG conducted a fact-finding mission in Bangladesh to discuss policy recommendations with stakeholders from the RMG industry. Six MPs participated in the visit: Simon Danczuk, Rushanara Ali, Jonathan Reynolds, Nick de Bois, Shabana Mahmood and Anne Main leading the group. The fact-finding mission built upon the research gathered from a range of qualitative interviews conducted beforehand with high street brands, NGOs, campaign groups, and with representatives from professional institutes, consultancies and the British and Bangladesh governments.
It is vital that the structural integrity of buildings and the infrastructure capacity of Bangladesh are improved. Poor infrastructure is a significant supply bottleneck which increases the pressures and costs of a supply chain characterized by a ‘fast-fashion’ model with short lead times and tight deadlines. Poor planning and building control have resulted in sub-standard construction and in 90% of buildings meeting no building codes2. Consequently, there is high chance of a repeat of the tragic events of Rana Plaza and Tazreen Fashion’s fire. These risks compromise the long term investments of brands and limit their ability to improve working conditions. In order to prevent a loss of future investment, the APPG recommends that the Bangladesh government, aided by brands and the international community, establishes a long term strategic plan to address these pressing concerns. The Accord on Fire and Building Safety, the Alliance for Bangladesh Worker Safety and the National Tripartite Plan of Action on Fire Safety and Structural Integrity (NTAP) are necessary first steps though these efforts must be coordinated and supported in order to build local capacity towards a sustainable solution.
In addition, brands have a responsibility to address the flaws in their purchasing practices. In a buyer driven market, brands have the ability to drive up working standards by creating the right incentive structure for purchasers and suppliers. There is a need for further brand investment in their supply chain to aid the up skilling of workers, improve management techniques and encourage more workforce representation. Best practice in corporate responsibility needs to be redefined by increasing expectations of what brands should achieve and by re-introducing the responsibility of the state to protect its own citizens. Brands themselves were encouraged by NGOs to integrate corporate social responsibility into their purchasing practices and to augment their auditing regimes with frequent factory visits and human rights due diligence. A more transparent and accountable supply chain is essential to rebuild the confidence of consumers, buyers and investors in the ethical nature of production. The APPG is aware that several brands have already made strenuous efforts towards improving working conditions and implementing Corporate Social Programmes, and commends such efforts believing that they should be shared as a matter of best practice.
This APPG report has the objective of suggesting policy recommendations to promote a RMG industry that works for consumers, business, workers and Bangladesh.
It is critical that regulatory and infrastructure reforms are carried out and working conditions improved to ensure that brands are not compelled to leave through global competitive pressures. The RMG industry will continue to have an important role as a driver of economic growth and employment if Bangladesh is to achieve its objective of reaching middle-income status.”
Click here to go through the full report.
BDST: 2020 HRS, NOV 12, 2013
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