Garments accounted for 84.58 percent of all export receipts that year while it was 81.82 percent in fiscal 2021-22, EPB data shows.Another unprecedented performance came in the form of the highest single-month apparel export earnings of $4.67 billion in December 2022.The 2023 apparel export earnings comprised $25.73 billion of knitwear and $21.25 billion of woven garments. These categories had year-on-year growth of 10.87 percent and 9.56 percent respectively.

If related products such as home textiles and specialised fabrics, including silk and wool, headgear and textile waste are included, the year-end export turnover would be $49.24 billion.This accounts for 88.35 percent of the overall export earnings of fiscal 2022-23.

“This is undoubtedly a significant accomplishment as we are passing through a turbulent time when global trade is shrinking,” said Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association.In fiscal 2022-23, apparel exports grew 10.27 percent year-on-year. In contrast, overall exports had gone up by 6.67 percent at the same time.This could be attributed to an 8.62 percent decline in non-apparel and non-textile exports.

“This is certainly not a healthy sign for the economy and we have been always supporting and promoting sector diversification,” Hassan said in a letter sent to garment manufacturers yesterday.”This contrast in growth in favour of garments is a testament to your dynamism and determination,” he added.The sector has witnessed a qualitative shift in product portfolio, moving beyond basic garments to higher-end products like non-cotton, outerwear, activewear and suits.

This diversification showcases the evolving capabilities and commitment to meeting the changing demands of the global market.”These factors, combined with our resilience, adaptability and innovative spirit, set us apart from our competitors,” Hassan said.

Bangladesh is the world’s biggest garments exporter after China. This week, after deadly protests between police and factory workers, the government mandated an almost 60 per cent raise to the minimum monthly wage to 12,500 taka ($113) from December, the first increase in five years.

Factory owners had said the wage hike, which comes ahead of a January general election, would eat into their profit margins by increasing costs 5-6 per cent. Labour accounts for 10-13 per cent of total manufacturing costs, industry estimates show.

Asked if they would raise purchase prices by the 5-6 per cent that costs will rise, Stephen Lamar, chief executive of the American Apparel & Footwear Association (AAFA), told Reuters: “Absolutely”.

“As we and our members have reiterated several times now, we are committed to responsible purchasing practices to support the wage increases,” Lamar said in an email.

“We also renew our pleas for the adoption of an annual minimum wage review mechanism so that Bangladeshi workers are not disadvantaged by changing macroeconomic conditions.”

Low wages have helped Bangladesh build its garment industry, which employs about 4 million people. Readymade garments are a mainstay of the economy, accounting for almost 16 per cent of GDP.

Even after the increase in minimum wage, which some workers said was too little, Bangladesh lags other regional garment manufacturing hubs such as Vietnam, where the average monthly wage is $275, and Cambodia, where it is $250, data from the International Labour Organization shows.

Last month, several members of the AAFA including Abercrombie & Fitch and Lululemon, told Bangladesh Prime Minister Sheikh Hasina they wanted workers wages to rise, and to take into account inflation, which is currently at 9 per cent. Lamar also wrote to Hasina in July.

Retailers in the United States and Europe are the main buyers of Bangladesh-made clothes. Like most consumer goods retailers, fashion companies are grappling with high inventories and a slowing global economy, where shoppers in key markets are buying less as they feel the pinch.

There are 101 factories where the workers did not even receive their wages for the previous month, March, according to the industrial police.

In addition to the RMG factories, the specialised police unit monitored other industries in Ashulia, Gazipur, Chattogram, Narayanganj, Mymensingh, Khulna and Cumilla.

As per their observation, out of the 9,616 factories in seven industrial zones, 35.88 per cent or 3,450 factories have not paid their workers’ Eid bonuses yet. Furthermore, 5.18 per cent or 497 factories have not paid the wages for the previous month.

Some 1,285 factories went into Eid vacation on Wednesday, taking the total number of vacation factories to 1,566 across the country. However, some 79 factories would keep their production uninterrupted during the Eid holidays.

The industrial police monitor a total of 9,616 factories in different areas of the country.

Shahidullah Azim, vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), slightly dissented from the industrial police’s observation.

He said there are 2,151 active factories in Dhaka and Chattogram under the BGMEA and all of them, except for 25, have paid wages for the month of March.

Also, some 90 per cent or 1,936 factories have already paid bonuses to their workers and 1,768 factories are expected to pay partial wages for the current month.

Shahidullah Azim also noted that they were in fear over the payment of wages and bonuses at two factories, but the issues have already been solved. All the factories will pay wages and bonuses to their workers by Thursday.

Some 430 factories under his association went into Eid vacation on Tuesday and 753 on Wednesday while 968 others are scheduled to go on vacation on Thursday, he added.

Mohammad Hatem, executive president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said there is no problem with the payment of salaries and bonuses now. A factory in Gazipur had complications over clearing the payments, but its owner assured of settling the issues by Thursday.

“We hope all the factories will pay the wages and bonuses and go into vacation by Thursday,” he added.

Regarding the overall issues, labour leader Sirajul Islam said the workers in some factories are demanding wages for 15 days of the current month. There are some issues with this demand, but no difficulties arose over the payment of Eid bonuses and wages for the previous month.

A meeting of the RMG tripartite consultative council (TCC) was held in the first week of the current month, with state minister for labour and employment  Monnujan Sufian in the chair.

The meeting decided that the owners of the garment factories will pay the workers’ bonuses before the commencement of Eid vacation, along with the wages for the previous month.

In the meeting, they discussed possible cooperation and future engagement
between BGMEA and Sedex to better facilitate Sedex certification for garment
factories in Bangladesh.

They also talked about collaboration to enhance the reputation of Bangladesh
as a safe, sustainable and compliant hub of apparel sourcing in the world,
said a press release here today.

Faruque said the RMG industry of Bangladesh made its footing stronger in the
global market over the years with remarkable achievements in the areas of
workplace safety, environmental sustainability and workers’ welfare.

Sedex, as an audit organisation, witnessed the impressive journey of
Bangladesh’s transformation both socially and environmentally, the BGMEA
President said, requesting Sedex to portray the positive picture of the
Bangladesh apparel industry internationally.

He also urged the World Bank for supporting the SMEs with low-cost finance so that they could upgrade their capability and adopt sustainability practices, and thus could thrive in the competitive market.

Faruque made the request when a high-level delegation of the World Bank, led by Axel van Trotsenburg, managing director of Operations, called on BGMEA President Faruque Hassan at BGMEA Complex at Uttara in the capital today.

The delegation included Martin Raiser, vice president, South Asia Region, Abdoulaye Seck, country director for Bangladesh and Bhutan; Dandan Chen, operations manager for Bangladesh and Bhutan; Yutaka Yoshino, lead economist/program leader, Martin Holtmann, country manager, IFC Bangladesh; Elena Karaban, manager, external communication; Barbara Weber, senior operation officer, country director’s office; Mehrin Mahbub, senior external affairs officer;

Kimberly Versak, senior external affairs officer; EwaSobczynska, senior operations officer, vice president’s office; Hosna Ferdous Sumi, private sector specialist, TTL Export Competitive for Jobs Project; Suhail Kassim, senior economist.

The present state of affairs in Bangladesh’s RMG industry including its challenges, potentials and the industry’s vision were discussed in the meeting, said a press release.

They also had discussions on the possible impacts of Bangladesh’s LDC graduation particularly on the apparel sector and preparations to retain the industry’s competitiveness in the post-LDC era.

BGMEA President Faruque Hassan apprised the World Bank delegation about the future priories of Bangladesh’s RMG industry, including increased focus on moving up the value chain through innovation, product diversification, technology upgradation, and up-skilling and re-skilling of the workforce to remain sustainable and cost competitive.

He also highlighted the tangible transformation of the RMG industry in the areas of workplace safety, environmental sustainability and workers’ wellbeing.

He spotlighted the importance of financing SMEs to support their development and as they often cannot avail regular financing schemes due to stringent due diligence.

BGMEA directors Abdullah Hil Rakib, Neela Hosna Ara, chair of BGMEA standing committee on foreign mission cell Shams Mahmud and chair of BGMEA standing committee on UD-Woven & Knit Md. Nurul Islam were also present at the meeting.

He said this MPS is primarily aimed at curbing inflation and to stabilize the foreign exchange reserve.

Sameer said this in the wake of the declared Monetary Policy for the January-June period of 2023 given yesterday by the Bangladesh Bank.

He said the public sector credit growth has been set by the government at 37.7 percent for January-June of FY23, which was 26.6 percent in June-Dec FY22, said a press release.

The DCCI President said the set target for public sector credit might cripple new borrowing and investment by the private sector.

“In order to reduce public sector borrowing, efficiency and good governance needs to be ensured continuously through reduction in government expenditure by way of austerity measures and prioritizing between development projects,” he said.

Also, in the current market condition, he said the proposed relaxation of lending rate cap for consumers’ credit and complete removal of the deposit floor rate may encourage savings and thus make smooth the liquidity reserve of banks.

Regarding the exchange rate stability, Sameer said the Bangladesh Bank hopes to gradually move towards a market-based, flexible and unified exchange rate regime by the end of this fiscal year.

In order to avoid trade-based money siphoning, he supported the decision of the Bangladesh Bank to beef up its monitoring to track import LCs before making any final payment.

“Also, it will be helpful to pre-inspect any LC which is worth $3 million or more,” he added.

However, in the given economic scenario, the DCCI President suggested relaxation of L/C margin for essential commodities and industrial materials for catering local and export-oriented industries.

Regarding control of inflation, the MPS has addressed some key issues especially relating to CMSMEs.

Sameer hailed the initiative of the Bangladesh Bank with regards to the re-finance scheme of more than Taka 50,000 crore, prioritizing investments in agriculture, CMSMEs and import substituting industries allowing them to avail term loans and working capital loans at easier terms and conditions.

“It will certainly help the quick revival of CMSMEs,” said Sameer.

Barrister Sameer opined that stern measures for quick loan recovery should be brought into place. In this connection, the Bangladesh Bank can identify and pinpoint the exact reasons, focusing on habitual defaulters, and start engaging with various institutions and stakeholders.

These efforts would result in working towards reducing the current backlog in recovery cases along with quick reforms to the existing laws by introducing ADRs in an effective manner.

Sameer also hailed the decision of the Bangladesh Bank to establish Special Monitoring Cell for continuous review and oversight of big loans as part of a comprehensive NPL resolution mechanism.

Regarding inward remittance from wage earners, he said the move of waiving documentary requirements in relation to remitting foreign exchange and money transfer fees by local banks as well as prior approval for withdrawal of money mentioned in the MPS are welcoming.

As a whole, Sameer said the declared MPS is promising with good indications to contain the current economic challenges.

“However, a timely implementation strategy through coordinated efforts from the public and private sector along with strong monitoring by the central bank can achieve the core goals of the money market and economy.”

Considering the major markets in the EU region as per the statistic of the Export Promotion Bureau (EPB), Bangladesh’s export to Germany grew by 3.54 percent year on year reaching $3.45 billion.

The country’s export to Spain and France grew by 17.62 percent and 33.08 percent with an amount of $1.70 billion and $1.41 billion respectively during the first six months of the current fiscal year. On the other hand, exports to Poland declined by 18.43 percent during the mentioned period.

Bangladeshi RMG export to USA stood at $4.27 billion in July-December period of the current fiscal year with only 1.11 percent year on year growth. At the same time, exports to the UK and Canada reached $2.39 billion and $774.16 million, with 11.89 percent and 28.42 percent growth respectively.

Apart from the traditional markets, the country’s apparel exports to non-traditional markets grew by 32.19 percent to $4.04 billion from $3.05 billion in the corresponding period of the previous year.

Among the non-traditional markets, export to Japan reached $754.72 million with 42.54 percent growth. Bangladesh’s exports to India also increased significantly by 50 percent, which is $548.89 million.

Talking to BSS, Director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Md. Mohiuddin Rubel said that although the statistics have shown positive growth in RMG exports to the major countries, but the growth has declined compared to the previous months of the current fiscal year.

“It indicates that the growth might be declined further in the coming months,” he added.

To further accelerate the country’s economic recovery in 2023, DCCI urged the government to focus on uninterrupted and affordable energy supply to local and export-oriented manufacturing industries, improve the ease of doing business, develop an infrastructural environment conducive to attracting local and foreign investment, export diversification, facilitate easier access to credit facilities for CMSMEs and so on, said a press release.

DCCI observed that the global economic downturn due to the COVID pandemic and the Russia-Ukraine war has hindered Bangladesh’s progressive growth.

However, the enterprising spirit of our business community and joint efforts of the public and private sectors have largely assisted our economic recovery process.

The recent increase in energy prices is disrupting the production of energy-intensive industries and they are increasingly falling behind to compete in international trade.

DCCI is of the view that long-term planning should be adopted following a predictable pricing policy in determining the energy price.

In order to ensure energy security, it is necessary to urgently explore new gas fields, strengthen long-term energy supply contracts and find alternative sources of energy import.

Besides, it is necessary to ensure an uninterrupted supply of energy to the industries and the government is requested to emphasize it as a matter of priority.

Issues such as the ongoing foreign currency crisis and devaluation of the Taka against the US Dollar have challenged the country’s financial sector, resulting in some negative impact on the import of energy, industrial raw materials and supply chain for local export-oriented industries.

More emphasis is needed on increasing incentives to increase remittance inflow in order to enhance the foreign exchange reserve. At the same time, ‘currency swap’ may be prioritized to meet necessary import expenditures.

In addition, DCCI believes that in order to mitigate the liquidity crisis in the financial sector, the ongoing austerity measures taken by the government should be maintained and project implementation efficiency should be increased ensuring good governance.

Due to the global economic problems and inadequate revenue collection of the government, the government has had to borrow more than its target from the local banks in recent times. As a result, the available credit to the manufacturing private sector may decrease.

It should be noted that if the private sector credit flow is interrupted, local investment and employment retention may decline. Dhaka Chamber feels that, in order to achieve higher revenue collection, the government should focus on complete automation of revenue management, necessary reforms of existing revenue laws and increasing the avenues for revenue generation. In this connection, special attention should be given not to harassing any existing taxpayers.

After the LDC graduation, in order to continue the existing export growth, we have to take the initiative of signing free trade agreements (FTAs) with potential trade partners and various regional economic blocs. In this transitional period of LDC graduation, we need to ensure proper readiness and preparation of local businesses. DCCI also feels that, inter alia, export diversification, infrastructure development, skills development, technological advancement, expediting backward linkage industries, reforms of tax and tariff structure and continued negotiation for ensuring “International Support Measures” even after LDC graduation are important agendas that the government should focus on.

Lastly, to increase local and foreign investment in the country, there is a need for timely reforms of various laws such as the Companies Act, Arbitration Act, and Bankruptcy and Insolvency Act. Utilizing the technological excellence of the 4IR to meet the skill needs of local industries and the international markets, special attention should be given to skilled and high-skilled manpower export. In this case, there is no alternative but to emphasise and strengthen the industry and academia relationship for the best utilization of the country’s demographic dividend in future.

The agro-based economy of the region is appropriate for facing the challenges of 4IR together with contributing to the country’s economy.

Industrial experts and academics came up with the observation while addressing a daylong workshop titled “Way Forward for Facing Challenges of 4IR” here this afternoon.

Bangladesh Entrepreneurs Development Foundation (BEDF) organised the workshop on the closing day of its four-day ‘entrepreneur’s conference and products exhibition on Shishu Academy premises.

Director of BSCIC Kazi Mahbubur Rahman and its Regional Director Rezaul Karim Sarker addressed the workshop as the chief and special guests, while Deputy General Manager Zafar Bayazid was in the chair.

Prof Muhammad Rokonuzzaman from the Department of Mechanical Engineering at Rajshahi University of Engineering and Technology discussed and devised ways and means how to face the challenges of 4IR during his keynote presentation.

Additional Deputy Commissioner Anisul Islam, Director of Rajshahi Chamber of Commerce and Industries Sadrul Islam and BEDF Rajshahi Divisional Convener Laila Nasrin also spoke on the occasion.

Prof Muhammad Rokonuzzaman said Bangladesh is marching towards the fourth industrial revolution. Bangladesh has the capability. In the process of adopting 4IR technologies, Bangladesh has recently achieved significant growth in various sectors, including the IT services industry as well as healthcare services.

“In the context of the 4IR’s impacts and subsequent challenges posed on the two aforementioned sectors in Bangladesh, it is a pressing need that we should address those challenges and assess the impact of using technology and information services in these sectors,” said Prof Rokonuzzaman.

The keynote speaker discussed how digital technology works in the context of entertainment, transportation, and communication and argued that the future depends on how we use this blessing. He also added that the fourth industrial revolution is able to reduce the social inequality and disruption cycle.

He also focused on transformation, top global perceived risks, and how single innovation changes the industry landscape.

“Best use of talent and research in various fields is needed for nation building. We have achieved independence under the leadership of Father of the Nation Bangabandhu Sheikh Mujibur Rahman. Now, we are working under the leadership of Prime Minister Sheikh Hasina to build the country,” he said.

The minister said this while speaking as the chief guest at a discussion marking the ‘Victory Day-2022’ at the Industries Ministry in the city, said a press release.

State Minister for Industries Kamal Ahmed Mojumder attended the discussion as the special guest while Industries Secretary Zakia Sultana presided over it.

Humayun said the ministry is working under the supervision of Prime Minister Sheikh Hasina to develop advanced and technology-based industrialisation.