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Bangladesh should leave low wage trap

Staff Correspondent
03 Oct 2023 21:19:05 | Update: 03 Oct 2023 21:50:36
Bangladesh should leave low wage trap
— Courtesy Photo

Bangladesh should move away from the low wage trap after graduating from Least Developed Country (LDC) status, as the existing minimum pay for readymade garment workers is not nearly enough to cover skyrocketing living costs.

The country’s development partners further pointed out that along with the government and industrialists, brands and buyers also have the responsibility to help Bangladesh leave behind the trend of low wages.

These remarks came at an event titled “Securing Green Transition of the Textile and Readymade Garments Sector in Bangladesh,” organised by the Centre for Policy Dialogue (CPD) on Tuesday.

CPD Executive Director Dr Fahmida Khatun chaired the programme, and Research Fellow Muntaseer Kamal presented a keynote.

A study, conducted on 403 factories and 4,541 workers, shows that 86.26 per cent of the respondents are aware about green practices in the factories, and know that such initiatives reduce health hazards, and improve workers’ productivity.

Moreover, 69.70 per cent of the factory owners were self-motivated to make their factories green, 54.55 per cent of the owners took green initiatives as part of their marketing strategy, and 39.39 per cent did it to boost competitiveness in the market.

The research also identified several significant sustainability areas such as energy, water, air, and chemical and waste management, where firms are investing in upgrading the technology for sustainable and green practices.

In the last five years, large, small, medium, and micro factories invested around Tk 78.07 million (36.98 per cent of total investment), Tk 1.37 million (44.84 per cent of total investment), and Tk 0.16 million (53.99 per cent of total investment), respectively.

Regarding challenges and barriers, the study mentions that the factories face challenges such as regulatory and policies, institutional barriers, factory level barriers, and market level barriers.

The manufacturers are motivated by various factors, rather a single one, to establish green factories, it mentions.

At the event, European Union (EU) Ambassador and head of delegation in Dhaka HE Charles Whiteley said, “It is very important to take into cognizance the workers’ health complaints. It is hard to avoid the wage issue. We are now at a very pivotal moment.

“It has been five years since the last wage revision, and the minimum pay stands at only TK 8,000. By any stretch of the imagination, it is not a very healthy way to live on, particularly if you have kids to feed.

He added, “I hope that we see something quite radical to come out of the wage revision that will reflect economic realities and the struggles of ordinary families here. So, the responsibility is not only on the government, or the industry, it is also on brands and buyers.

“There are excellent examples of real engagement and partnership amongst brands.”

Expressing his concerns about the future of 4.5 million workers, Charge D’affaires at the Netherlands Embassy in Bangladesh Thijs Woudstra said, “Bangladesh (should) move away from the low wage trap when graduating [from the LDC status].

“There are no alternatives to improving working conditions and wages. The green initiatives of RMG will help the country to be more competitive beyond 2026.”

Addressing the event, Fahmida Khatun said, “Our next challenge is to be prepared for green industrialisation, and the pressure will come after the LDC graduation. The awareness of a safe environment is increasing day by day.

“Invest in environment friendly industries, and adopt eco-friendly technology. We are currently at the learning stage. To ensure green industry and reduce carbon emissions, we need comprehensive efforts.”

As the apparel and textile sector are export-oriented, the country should focus on these areas more, she added.

State Minister of Planning Shamsul Alam said, “The manufacturers must demand fair prices from brands and buyers to accelerate the greening process in the RMG sector. The five-year plan is the government’s flagship programme, and we will provide more policy support in the ninth five-year plan.”

“The government is giving various incentives to the industries. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) should train their workers well regarding their rights, privileges, safety, health issues, and other facilities.”

Mentioning that the country’s RMG industry has 202 LEED-certified Green Factories by USGBC and over 500 are waiting for certification, BGMEA Vice President Shahidullah Azim said, “We have received the 2021: USGBC Leadership award.”

“The BGMEA has taken a series of initiatives under its Sustainability Vision 2030, and our key aims to reduce 30 per cent greenhouse (GHG) emissions, 50 per cent use of sustainable raw materials, 50 per cent reduction of groundwater usage, 30 per cent reduction of energy usage and 20 per cent use of renewable energy.”