Experts and policy makers believe that there is no way to ignore the US and the European Union (EU) policies regarding the Bangladesh’s labour issues, and its need a joint effort to overcome any potential trade restriction.
They also believed that to create a sustainable export sector, product and market diversification and available data and information are most important, and the government and stakeholders should focus on these areas.
They made the remarks on a seminar “Global Economic Slowdown, Bangladesh’s Apparel Industry and Decent Work”, on Sunday at the Bangladesh Institute of International and Strategic Studies (BIISS) auditorium in the capital.
The national research institute and think tank organised the seminar.
As the chief guest of the event, Dr Mashiur Rahman, former economic affairs adviser to the Prime Minister said “Bangladesh entered global market and [forex] reserve to have to be concerned about how things are changing is about and around us and how things are changing within us.
“So, there is a continuous transformation of the economic challenges that we face and the continuous update and adapt to those challenges.”
He called on investors to invest in capital machineries to make high-end products, and logistics for better transportation management which would grow the country’s e economy.
In the seminar, Foreign Ministry Senior Secretary Masud Bin Momen said that the recent US presidential memorandum has already created apprehension in Bangladesh industry because of the possibility of restricted entry to the US market.
“It may have negative consequences in sourcing materials from and exporting to other countries. The significant progress met so far for improving work conditions for our workers will be greatly hampered.”
He suggested that if such restrictions will be applied, it is a responsibility of the entrepreneurs, buyers, development partners in importing countries and regions experts and other stakeholders to collaborate to overcoming these challenges, and sharing the sustain success of the industry.
“We need to chart path towards the more robust and sustainable future for Bangladesh's industry,” Momen added.
Centre Policy Dialogue (CPD) Distinguished Fellow Mustafizur Rahman said that everyone know there is a pressure from the USA with regard to the trade union rights, with regard to what percentage of signatures for a trade union organisation will require.
“We can ignore that and we can say that we have signed all the conventions. But the issue is enforcement and if you review the new EU GSP text, you will see that so much pressure on gender rights, good governance and environment.
“We cannot ignore what USA has said we cannot ignore what the EU has been saying, so we have to be more I think proactive rather than reactive,” he added.
Adding green factories have become the new normal and this will become essential elements of sourcing, Mustafizur said, “So the global market is not working as we expected.
“This is a buyer driven value chain, but there are also global campaigns, and the US Congress representatives was mentioned that president will also have to exert on them. There is hypocrisy between ethical buying and ethical sourcing, and we should expose that.”
Shasha Denims Managing Director Shams Mahmud said that normally he monthly exported worth $3.5-$4 million goods, but it’s increased to $9 million in this November and December.
“This happened only for product diversification. So, we have to more diversify. Our main challenges are new GSP policy and long term energy policy. We have to focus on these areas.”
BGMEA President Faruque Hassan said that the worldwide inflation has directly affected the retail market and we witnessed a decrease in overall earnings.
“This pressure affected the prices of major clothing items, leading to a 7 per cent-9 per cent decrease in average unit prices of major items.”
“Excess inventory, less consumption and less demand impacted the price level. On the local front, we faced challenges in terms of increased electricity and gas prices, a decrease in foreign currency reserves, fluctuations in the dollar exchange rate, issues and losses related to wage determination and several others,” he added.
Tapon Kanti Ghosh, Senior Secretary at the Commerce Ministry, said, “Amid the current economic slowdown, Bangladesh’s RMG export is good as we took a lot of initiatives. However, further market diversification is important for us.”
BKMEA Vice President Md Akhter Hossain Apurbo said, “We, producers are now in tremendous pressure because of the economic downfall in the world. The foreign borrowing interest rate was LIBOR +1.75 per cent. But after the Russia-Ukraine war, it’s jumped to around LIBOR=5.
“The government increased gas and electricity prices in several times, and again there is lack of supply. Industrialists are in pearl for these.”
