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[🇧🇩] Textile & RMG Industry of Bangladesh

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[🇧🇩] Textile & RMG Industry of Bangladesh
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Impact of automation in apparel sector
FE
Published :
Dec 24, 2024 22:04
Updated :
Dec 24, 2024 22:04

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The latest development in the readymade garment (RMG) factories of the country, courtesy of limited automation, has sent mixed signal to all concerned. Particularly, the workers are alarmed, for it means loss of their livelihood. Already close to 31 per cent workers, mostly helpers, in the production process of the RMG units, have reportedly lost their jobs as a result of automation. Similarly, the cutting section of the RMG units have experienced the biggest (nearly 50 per cent) job cut. In comparison, the sewing process suffered the least with about 27 per cent retrenchment. But factory owners, on the other hand, are elated since automation has enhanced the industry's productivity. No doubt, higher productivity is the most sought-after development of the RMG industry in the interest of gaining competitive edge of its products in the international market. However, one cannot also be oblivious of the plight of the workers who have already lost jobs including those who are going to face similar reality in the future due to increased automation in this industry. The emerging realities in the RMG sector call for striking a balance between these two mutually conflicting developments.

These are the findings of a recent study, titled "Assessment of technological transition in apparel sector in Bangladesh and its impact on the workers" conducted by local and international non-profit organisations and a local private university. The study brought to light how different segments of the apparel sector such as the sweater factories saw the highest number of job cuts followed by the woven factories. In a similar vein, the study also show women, who overwhelmingly dominate the workforce in the apparel industry, are getting a raw deal in terms of job-loss at 62 per cent as the fallout from automation. However, in the case of some larger apparel factories, the women risking automation-related unemployment have been reassigned, that is, transferred to other sections. But this is a temporary answer to the challenge for some of the female workers who are already in employment. But those women, especially from the countryside, who have been looking for employment in the garment industry will now be left with fewer opportunities.

Against this backdrop, since the RMG sector gained a global reputation as a model job creator for women in Bangladesh, it has a stake in continuing in that role. In that case, the RMG industry needs to find ways to avoid firing workers, more particularly the female among them, to maintain its positive image. There is yet another group of workers who are also the victims of automation. They are the aged, the unskilled, the less educated workers. While there is no question of opposing automation which is but the way forward for industries in the future, one cannot also leave the retrenched workers in the lurch. To get around this dilemma, the best way is to upskill workers, both women and men, who are already in employment in the apparel sector so they may keep up with the pace of automation at their workplaces. At the same time, both the government and the industry should create training facilities where members of the new generation of workforce might learn the skills required for jobs in the automated apparel factories.

What is important to note here is that it is not only the apparel industry that is facing this transformational challenge. In fact, the trend is all-embracing. In that event, preparations should be there for the government and the industry so the working class might tide over the crisis automation is going to bring with it.​
 

Automation but no wastage of human capital
Sarker Nazrul Islam
Published :
Dec 24, 2024 22:03
Updated :
Dec 24, 2024 22:03

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It is indeed a good development that the country's labour-intensive apparel industry is advancing along the path of automation to accelerate the production process and reduce the cost of production. Automation has gained greater importance for Bangladesh when its competitors such as China and Vietnam are far ahead in the introduction of robotics and artificial intelligence in the production of readymade garments. The more Bangladesh advances in adopting automation, the more it is likely to remain on a par with or gain competitive edge over its rivals. But automation is not all about development of the sector; innovative fashion designs and switch over to manmade fibre are vitally important to achieve the objective. Upskilling workers, as demanded by new technology, is a formidable challenge before the apparel sector.

Apparel industries have started reaping benefits of automation. Quoting survey findings conducted by Solidaridad Bangladesh, Bangladesh Labour Foundation and BRAC University, The Financial Express reports that because of introduction of advanced machines, efficiency has increased by 3.0 per cent to 5.0 per cent; knit polo shirts productivity also increased to 140 from 90 per hour and rejection reduced from 10 per cent to zero per cent, which is no doubt a remarkable achievement that substantiates the benefits of automation. Weekly overtime has also dropped from 20 hours on an average to 11 hours mainly due to faster production cycle enabled by automation. A factory now requires only one person for spreading fabrics instead of seven in times of manual process. Data automation also enables manufacturers to track production metrics, energy use and maintenance schedules.

Production automation has already proved to be a boon for the industry. But, despite a host of positive impacts of automation on overall productivity in this industry, this is not a case of unmixed blessing, particularly for millions of unemployed girls. Upgrading of technology has eliminated more than 30 per cent jobs from the country's apparel industries. The cutting section of the RMG industries saw more than 48 per cent job cut, the highest in the sector, while it is about 27 per cent in the sewing section where majority of the workers, especially women are employed.

Due to data discrepancies, it is very difficult to find the exact number of unemployed youth in Bangladesh. The number of the unemployed aged between 15 and 29 is likely to be around 2.6 millions. Their number is swelling with the joining of around 2.0 to 2.2 million working-age people to the job market every year. But generation of employment opportunities is far below the demand level due to stagnancy or sluggish growth of industries and the service sector. Introduction of automation is likely to further aggravate the unemployment situation. However, this is not an argument against the necessity of automation in industrial production. Despite introduction of automation, the situation of unemployment must not be allowed to worsen; it must be averted through adoption of pragmatic strategies aimed at reaping the benefit of demographic dividend.

Women are still the majority of RMG workers. Employment in the garment factories created an opportunity for them to live a worthy life. Their participation in production was a significant step in the direction of women empowerment. But, with the introduction of automation, they are going to be more affected than their male counterparts. According to the above survey, in the process of automation women were replaced either by reassigning to different roles or, in some cases, dismissed. Alternative job opportunities should be created for them instead of retrenching them and thus depriving them of their financial liberty. Automation is a must for faster growth of the economy but surely not at the cost of demographic dividend.​
 

Did Vietnam really overtake Bangladesh’s 2nd spot as an RMG exporter?​


Bangladeshi apparel manufacturers said they only rely on the official data published by the World Trade Organization (WTO) regarding global trade
https://www.dhakatribune.com/369185

Photo: Mahmud Hossain Opu/Dhaka Tribune
Photo: Mahmud Hossain Opu/Dhaka Tribune

Saddam Hossain
Publish : 26 Dec 2024, 06:22 PMUpdate : 26 Dec 2024, 07:17 PM

A Vietnamese news portal, Voice of Vietnam (VOV) claims that Vietnam has surpassed Bangladesh to become the world’s second-largest apparel and textile exporter, ranking only behind China.

The Vietnamese news outlet cited Hoang Manh Cam, spokesperson for the Vietnam National Textile and Garment Group (Vinatex), one of the largest Vietnamese textile companies, who briefed the Vietnamese journalists on Wednesday.

He said that the Vietnamese textile and garment industry seized a significant number of orders shifting from Bangladesh in 2024, contributing to the industry’s revenue milestone of $44 billion, representing 11%, while Bangladesh, Vietnam’s most potent rival recorded a 3.7% decline in textile and garment exports in 10 months to only $27.7 billion.

However, the RMG manufacturers of Bangladesh refuted Cam's statement, saying Vietnam includes apparel and textiles as a single product in its overall export earnings, while Bangladesh separates apparel, home textiles, and textiles into three different products. So, Vinatex’s data does not represent authentic data.

Moreover, Vinatex is not a government entity; it is a private RMG and textile manufacturer, so their data can not be regarded as official data.

What does official data say?


Meanwhile, the data presented by Vinatex even contradicts the official export data of the General Statistics Office (GSO), the government’s official statistics organization of Vietnam.

According to the GSO, Vietnam earned $30.57 billion from exporting textile and apparel items in the first ten months of 2024 (January-October), meaning lone income from apparel or sewing products was indeed below $30 billion.

However, Vinatex reported that Vietnam earned $44 billion in January-October 2024.

According to World Trade Organization data, in 2023, the Southeast Asian country earned $33.32 billion from its global destinations by exporting textile and sewing products, while earnings from apparel or sewing products were $31 billion.



On the other hand, Bangladesh earned $31.41 billion by exporting only apparel items in the January-October period of 2024, while Vinatex said the world’s second-largest exporter earned $27.7 billion, which the apparel manufacturers turned down.

Only WTO’s data is reliable

Bangladeshi apparel manufacturers said they only rely on the official data published by the World Trade Organization (WTO) regarding global trade. WTO usually publishes global trade data titled “World Trade Statistics: Key Insights and Trends” in August of every year.

Talking to Dhaka Tribune, Mohiuddin Rubel, former director of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said they only rely on WTO data.

“Vietnam’s exports will always be higher than ours as they include all types of textile products along with apparel. We categorize apparel as a single product. Our earnings will once again supersede Vietnam if we include earnings from home textile and textile sector along with apparel,” he added.

He also said that Bangladesh will officially be the world's second-largest apparel exporter until the publication of the WTO data on 2024 trade trends in August 2025, and they are working hard to retain the position.

WTO Data 2023

In the first week of August of this year, the WTO published its “World Trade Statistics 2023: Key Insights and Trends,” which showed that Bangladesh has maintained its position as the world’s second-largest apparel exporter and exported apparel items worth $38 billion to its global destinations.

In 2023, Bangladesh's global apparel market share was 7.4%.

In the same year, Vietnam, Bangladesh’s arch-rival in RMG exports, secured third position with a market share of 6% and exported apparel items worth $31 billion.

Among the major RMG exporters, China remains the largest exporter of RMG products in the global market, with a 31.6% market share. The country exported RMG goods worth $165 billion in 2023.

Meanwhile, the VInatex spokesperson also said that despite having a product range and geographical advantage similar to Bangladesh, India benefited the most from the trend of orders shifting away from Bangladesh in the past year.

Other leading exporters, such as Sri Lanka and Turkey, also benefited from the shift in orders from Bangladesh.

However, Cam warned that these results may only last for a certain period, noting that Bangladesh’s exports have been recovering market share in September and October. Therefore, there is a possibility that Bangladesh will soon recover its textile exports, and competition will return.

The garment industry is expected to continue the momentum from the end of 2024 and see some positive growth signals in the first half of 2025 as key markets such as the US and the EU recover economically.
 

Charting a path ahead for the RMG sector

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Bangladesh's economy relies heavily on the RMG sector, which faces numerous challenges. FILE PHOTO: STAR

Bangladesh has emerged as an economic success story, primarily through its booming ready-made garments (RMG) sector. The country's exports in this industry surged from $23.5 billion to $47.38 billion between 2013 and 2023, lifting millions out of poverty and gaining international recognition. Key factors driving this growth include a cost-effective workforce, dedicated entrepreneurs, strong financial systems, and political stability, resulting in a remarkable seven percent annual growth rate. Bangladesh is now the world's second-largest apparel exporter, solidifying its status in the global fashion market.

The Covid pandemic, global supply chain disruptions, and the Russia-Ukraine conflict have revealed the vulnerability of Bangladesh's economy, which relies heavily on a single industry. This dependence has resulted in insufficient revenue from other sectors to meet financial obligations. The country is facing high inflation and unemployment, largely due to poor policy decisions and a lack of economic diversification. Overall, Bangladesh is grappling with significant economic challenges.

Despite significant growth in the RMG industry, Bangladesh faces numerous challenges, particularly its impending transition from Least Developed Country (LDC) status by 2026. Following this graduation and a subsequent three-year grace period ending in 2029, Bangladesh will lose its duty-free, quota-free, and preferential Rules of Origin benefits for apparel exports to the European Union, a crucial market that represents nearly half of its RMG exports.

The loss of LDC-specific trade preferences will raise Bangladesh's effective tariffs by approximately 5.7 percent, potentially causing a 14.3 percent drop in apparel exports, equating to a loss of $5.37 billion annually. In response, Bangladesh has launched an ambitious plan to reach a $100 billion annual export target by 2030. This optimism is supported by the country's strong historical growth, policies to enhance backward linkages, product diversification, and a stable political environment, which collectively suggest a promising future for its export sector.

To achieve its policy goals, the nation must strategically enhance value addition, particularly in the RMG sector. Currently, value addition has stagnated at 50-65 percent over the past decade. By increasing the use of domestic fabrics and yarns, Bangladesh could elevate this figure to 70-75 percent, which would significantly boost net export earnings.

Bangladesh produces 85 percent of the yarn needed for knitted cotton fabrics, but only meets 35 percent of the demand for woven garments and man-made fibre (MMF) based apparel domestically. The country faces challenges with limited domestic production of MMF materials. Enhancing the production of woven and non-cotton yarns and fabrics could significantly increase Bangladesh's export earnings.

Bangladesh can boost its apparel manufacturing sector by leveraging MMF, such as polyester, to meet the growing global demand for non-cotton textiles. Currently, MMF constitutes 77.6 percent of global fibre production, while natural fibres, including cotton, account for 22.4 percent. This trend is driven by consumer preferences for functional and stylish clothing, which MMF-based garments can provide. Additionally, MMF products typically command higher prices and can yield greater export revenue compared to cotton-based apparel.

Bangladesh currently holds a modest 16.9 percent share of MMF apparel exports, significantly less than China (42.8 percent) and Vietnam (46.9 percent). To enhance its position in the growing MMF market, Bangladesh needs to improve its MMF manufacturing capabilities. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) aims to increase MMF-based garment production to 40 percent by 2030. By expanding MMF production, Bangladesh can better meet global demand, diversify its ready-made garment sector, and enhance domestic value addition in the supply chain.

The rapid scaling of MMF production by 2030 faces three main challenges: the need for significant foreign capital investment, a shortage of specialised knowledge and skills in Bangladesh to operate the required capital-intensive machinery, and a lack of incentive programmes to attract investors to MMF manufacturing facilities.

The remarkable growth in MMF apparel exports of countries like China and Vietnam was significantly driven by foreign investment. Foreign investment brings in foreign currency, machinery, technology, and expertise to develop high-value industries like the MMF. In Bangladesh, the Bangladesh Investment Development Authority (BIDA) is responsible for attracting investment and should serve as the central coordinating body to streamline bureaucratic processes and instil confidence in foreign investors. BIDA should analyse successful markets and devise a comprehensive and best-in-class strategy. A major challenge for foreign investors in Bangladesh is the absence of downstream liquidity in the capital markets, which hinders their ability to exit or diversify their investments. BIDA should spearhead collaboration between government agencies and the private sector to address this issue.

Saleudh Zaman Khan, managing director of NZ Textile and a vice president of the Bangladesh Textile Mills Association, shared in an interview how Bangladesh can rapidly gain a foothold in the highly competitive MMF apparel market, which is currently dominated by China and Vietnam. "Bangladesh government must adopt a fast-track strategic approach and offer substantial incentives to encourage the manufacturing of MMF and MMF-based garments," he said. "The incentive programmes must ensure the long-term sustainability of MMF manufacturing facilities by providing additional incentives to compete against foreign competitors, especially China and Vietnam," added Saleudh. He also emphasised that these incentives should be extended to both local and foreign investors in the MMF production sector, in-order-to promote and reinforce the domestic supply chain.

Bangladesh's dependence on imported cotton and MMF poses risks such as price fluctuations, supply chain issues, and geopolitical tensions. To mitigate these challenges, establishing a strategic reserve for cotton and MMF is recommended, allowing for a reliable raw material source during disruptions. This reserve would require specific storage facilities for at least a six-month supply and could be developed without direct investment by incentivising suppliers to store their inventory within the country. This approach would help spinning mills access materials quickly and cost-effectively, saving on inventory costs while ensuring prompt delivery.

Finally, Bangladesh needs to broaden its economic base, and the government should enhance research funding in science and technology to reduce dependence on the garment sector. Bangladesh's graduation from LDC status will allow the country to diversify its product offerings and strengthen its supply chain for higher-value goods. This transition encourages the use of advanced technology and automation to boost productivity and profitability. To comply with stricter origin requirements, particularly the "double transformation" criterion for the EU market, establishing strong backward linkages will be essential once preferential trade access ends.

Dr Quamrul Ahsan is managing director of Sarah Textile Mills Ltd, and a former faculty member at BUET.​
 

Vietnam may surpass Bangladesh in garment export: report

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Workers are seen at a garment factory in Hung Yen province of Vietnam. Photo: Reuters/file

Vietnam is set to generate $44 billion this year through garment exports, surpassing Bangladesh, which is currently the world's second-largest garment exporter, according to a Vietnamese media report.

Bangladesh's export goal is $4 billion lower than Vietnam's.

Vietnam's apparel and textile sector is set to earn an export revenue of $44 billion this year, up 11 percent year-on-year, and will likely surpass Bangladesh to become the world's second-biggest exporter in the sector.

Meanwhile, Bangladesh set a target of $40.48 billion for garments, out of a total of $50 billion for overall exports, with an 11.99 percent growth for fiscal year 2024-25. Bangladesh does not set garment export targets on the basis of calendar year.

The export target for knitwear and woven items is $21.7 billion and $18.78 billion respectively.

At a press meeting on Wednesday, Cao Huu Hieu, CEO of Vietnam National Textile and Garment Group (Vinatex), the country's biggest garment maker, announced the $44 billion export target.

He stressed that the sector's performance was weak in the first half of 2024 as the global economy underperformed, and the sector received few orders with strict conditions.

However, the sector recovered and thrived in the second half of this year, not thanks to the growing demand, but because of the political issues in Bangladesh promoting firms to make orders in Vietnam. This is a "fortune" for the sector amid challenges, he added.

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said there was no doubt that Vietnam would surpass Bangladesh as the east Asian country's apparel industry faces no bottlenecks.

He stated that Vietnam finds it easy to increase exports of garment goods because there was no labour unrest, gas crisis, or tax issue there.

However, he continued, Bangladesh faces numerous issues that make it difficult for exports to increase.

Even though labour costs are lower than those of Vietnam, exporters of garments encounter challenges at every turn, making it impossible to take the initiative to increase production, he said.

Given that the Trump administration will impose high tariffs on Chinese goods, Hatem even mentioned the possibility of obtaining new investment from China.

He added that although there was potential to draw Chinese investment in attempts to avoid high duties in the US market, there are a number of barriers that prevent Chinese investment from coming here.

Bangladesh fetched $36.15 billion through garment exports last fiscal year, which was 5.22 percent lower than that in the previous fiscal year.

Of the total export earnings, the knitwear sector earned $19.28 billion while woven garments around $17 billion.​
 

No growth in RMG exports to non-traditional markets​

Staff Correspondent 28 December, 2024, 23:58
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Bangladesh’s readymade garment exports to non-traditional markets slightly declined in the July-November period of FY2024-25 due to reduced knitwear shipments, while earnings from traditional markets, including the United States and the European Union, saw significant growth in the period.

The country’s export earnings from the nontraditional market in the first five months of FY25 fell by 0.77 per cent to $2.76 billion from $2.78 billion in the same period of FY24, according to the Export Promotion Bureau data.

Woven garment exports to nontraditional markets in the period grew by 11.26 per cent to $1.36 billion while knitwear exports declined by 10.23 per cent to $1.40 billion.

The country’s export destination other than the US, the EU, the UK and Canada considered as nontraditional market.

Although the RMG exports to nontraditional markets decreased slightly, the earnings from Japan, India, South Korea, Turkey and Mexico registered a moderate growth in the first five months of FY25.

Bangladesh’s RMG exports to Japan in July-November of FY25 increased by 3.69 per cent to $496.20 million from $478.57 million in the same period of FY24.

RMG exports to India in the five months of FY25 grew by 16.48 per cent to $325.06 million from $279.06 million in the same period of past financial year.

The country’s apparel exports to Turkey in July-November of FY25 increased by 50.54 per cent to $181.85 million while the shipment to Brazil grew by 30.06 per cent to $66.04 million.

RMG exports to Russia in the period fell by 9.34 per cent to $115.04 million while the export earnings from the United Arab Emirates declined by 15.44 per cent to $98.27 million.

EPB data showed that nontraditional markets contributed 17.11 per cent to total RMG exports in the first five months of FY25, down from 19.37 per cent in FY24.

According to the government data, RMG exports to the EU grew by 13.74 per cent while the exports to the US increased by 17.44 per cent in July-November period of FY25.

It also showed that RMG exports to the UK market in the first five months of FY25 recorded growth of 5.84 per cent while the shipment to Canada increased by 13.22 per cent in the period.​
 

Can apparel industry weather any storm? 2024 offers clues

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For the local apparel industry, 2024 was a year marked by challenges, recoveries and a renewed sense of hope as the global market began to brighten -- proving once again the resilience of Bangladesh's apparel might.

Energy crises, dollar shortages, supply chain disruptions, labour unrest centring pay hikes, political uncertainty and a slack law and order situation: the list of domestic challenges for apparel-makers in 2024 was extensive.

In a positive development, Western buyers began returning to Bangladesh following the fierce nationwide movement and political changeover, as inflationary pressures eased and the world recovered from the pandemic and war fallout.

Consequently, Bangladesh's apparel shipments to major export markets like the EU and the USA rebounded. In the July-November period, the country's shipments grew by 16.25 percent year-over-year to $16.11 billion.

"This indicates that the future is brighter now than a few months ago," said MA Jabbar, managing director of DBL Group, whose top clients include Walmart-George, Puma, Esprit, and G-Star.

"I can see a very positive outlook for garment exports," Jabbar added.

The local apparel industry, which fetches the lion's share of the country's export earnings, began 2024 just after emerging from pay hike movements and with increased wages.

Amid the Covid recovery, global markets were then reeling from inflationary woes and the Russia-Ukraine war. There was also the Red Sea crisis and conflict in the Middle East.

Then, in June, the quota reform movement began, blocking apparel shipments to foreign markets.

In July and August, government-imposed internet blackouts and curfews intensified the situation, culminating in a violent political changeover.

This caused deadline delays for apparel-makers, many of whom had to offer discounts to compensate for late shipments.

Amid this struggle, massive labour unrest erupted in major industrial belts on the outskirts of Dhaka in July and continued until October, affecting both production and shipments following the nationwide student movement.

Labourers left production lines, blocked roads and streets and chanted slogans for pay hikes and increments, disrupting the already struggling local apparel manufacturing.

Due to unrest, vandalism and fires, factories in major industrial belts like Gazipur, Savar, Ashulia, Zirani and Zirabo were shut down for several months.

In September, factory owners, labour leaders and workers agreed on a resolution for their 18-point demand.

The minimum wage board increased the annual increment for garment workers to 9 percent from previous 5 -- one of the key labour demands in the 18-point.

The new increment took effect in December and the other demands, except for the amendment of the labour law, have been met too. The government has promised to amend the law by March next year.

For many, the resolution after the unrest meant production resumption, but for a few, it was worse.

For instance, Beximco Group laid off over 40,000 workers from its 16 textile and garment units.

The outgoing year involved correcting export data, as export earnings were previously overstated due to incorrect calculations.

In a final calculation, the central bank said that the garment sector's earnings in fiscal 2023-2024 were $36 billion, rather than the $47 billion calculated by the state-owned Export Promotion Bureau (EPB).

The outgoing year was challenging but also a time for business recovery as work orders rebounded with political stability, said Faruque Hassan, a former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Hassan said international retailers and brands are now returning with work orders as sales in the USA and EU have grown with the rebounding of retail sales.

According to BDL Group's Managing Director Jabbar, 2024 was one of the highest-exporting years, as they received massive work orders from international clothing retailers and brands.

"Now we really need to do more for better growth of the sector," Jabbar told The Daily Star over the phone.

He recommended establishing a dedicated EPB-like institution for the garment sector and ramping up investment in man-made fibre and sportswear segments to capture more global markets.

Meanwhile, Rizwan Rahman, a former president of the Dhaka Chamber of Commerce and Industry (DCCI), called for political stability for business growth.

He said the law and order situation has not improved to the expected level and is still affecting the business environment.

According to former BGMEA president Hassan, apart from political and labour unrest, the perennial power and energy crisis severely impacted investment inflow into the sector. As a result, many jobs could not be created in the sector this year.

Hassan also suggested investing more in man-made fibre to get better prices and increase exports, as the demand for specialised garments is increasing worldwide.​
 

RMG workers withdraw protests in Ctg

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Photo: Md Rajib Raihan

Workers and staff of various units of Pacific Jeans Ltd at Chattogram Export Processing Zone today withdrew their two-day protest after the owner pledged to meet their demands.

CEPZ Executive Director Md Abdus Sobhan said the managing director of the company met with the workers around 2:30pm.

The management announced a holiday for today and urged all the workers and staff to join work tomorrow, he said.

Earlier, thousands of workers continued their protests for a second consecutive day today, pressing for additional demands beyond those addressed by the company yesterday.

Following daylong demonstration by workers on Saturday, Managing Director Syed M Tanvir issued a circular saying that the company has agreed to halt forced resignations and inter-unit transfers, meeting two of the workers' demands.

The workers today demanded to fulfil their other demands including termination of some senior officials of the management, raise in different allowances including tiffin and transport allowances, full presence bonus and over time for the staff (team leaders)​
 

Home textile exports bounce back
Taka devaluation, increased production capacity boost shipment

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The export of home textiles is on the path to recovery after nearly one year because of the devaluation of the local currency, increased production capacity and improvement in gas supplies to some extent.

Home textile exports grew by 7.85 percent year-on-year in the July-December period of the current fiscal year to $410.81 million while it was in the negative even two to three months ago.

Apart from garment items, home textile is one of the three new sectors whose exports crossed $1 billion recently. The two other sectors are jute and jute goods and leather and leather goods.

Home textile exports showcased strong growth of 20.47 percent year-on-year in December to reach $83.98 million, according to data from state-run Export Promotion Bureau (EPB).

Home textile mainly refers to carpets, rugs, floor coverings, curtains, cushion covers, napkins, towels, bedspreads, furnishing fabric, table linen, bed linen, sheets and pillowcases, blankets, shower curtains, aprons, and wallpapers.

Its export fell sharply almost year-round in 2023 and 2024 as the local exporters did not book new work orders for an abnormal price hike of gas.

The Bangladesh government suddenly hiked gas prices by 150.41 percent in February 2023, from Tk 11.98 per unit to Tk 30 per unit, and a good volume of work orders shifted to Pakistan.

Work orders for home textile are booked for one or two seasons in bulk quantities.

With the abnormal gas price increase, exporters could not manage the cost of production, and they did not run their units at full capacity and refused some work orders, which went to Pakistan.

However, the devaluation of the local currency against the US dollar, increased spinning capacity and improvement in gas supplies to some extent helped pull back the business confidence of local exporters.

The shipment of home textile is also returning to its previous volumes gradually.

Also, the fall of inflation in Europe and the US has also been helping to recover home textile exports, said Md Shahidullah Chowdhury, executive director of Noman Group, which accounts for more than 70 percent of Bangladesh's home textile exports.

"We also increased our capacity to an extent with the improvement of gas supply, and exports from the company are growing now," Chowdhury said.

Last month, total home textile exports from his group reached nearly $27 million while it was worth $22 million in the previous month.

He also said the gradual restoration of normalcy in Bangladesh and political unrest in Pakistan also played a role in the restoration of home textile exports.

The country's home textile exports had crossed $1 billion in FY21, registering a whopping 49.17 percent year-on-year growth.

That momentum continued the following year, with exports rising by another 40-odd percent to $1.62 billion.

However, the gas crisis upended that trend the following year, with home textiles fetching $1.09 billion, down by almost a third.

Bangladesh was struggling to recover lost work orders in the home textile segment, a significant volume of which was shifted to Pakistan nearly two years ago.

This shift occurred mainly due to the sudden doubling of gas prices in Bangladesh and significant devaluation of the Pakistani rupee against the US dollar.

More recently, labour unrest in industrial belts and months of political unrest in Bangladesh have contributed to lower receipts.

Moreover, Pakistan possesses some inherent advantages, such as being the world's seventh-largest producer of cotton, according to Statista.

Pakistan also enjoys benefits under the EU's Generalised Scheme of Preferences Plus (GSP+) while Bangladesh only enjoys standard GSP facilities.

The number of home textile mills has also increased, especially smaller units, said Monsoor Ahmed, former chief executive officer of the Bangladesh Textile Mills Association (BTMA).

For instance, previously six to seven major textile mills used to export home textile, but the number of home textile exporters is more than 25 now, including the small units, he added.

Khorshed Alam, chairman of Little Group, a textile miller, said the production of home textile increased and exports also grew.

At the same time, a few mills stopped production as they were losing work orders during the shifting of work orders to Pakistan.

BTMA President Showkat Aziz Russell said the devaluation of the Taka against the US dollar was the main factor for the improvement in the home textile sector, which helped the exporters to be more competitive.

Moreover, more than 9 million new spindles have been installed over the last few years, which boosted the production in the textile sector.

The target is to install 15 million spindles, and it is expected that the installation of more than six million more spindles can be completed by the end of this year, which will also boost the production of primary textile, including home textile, he added.

"The gas supply improved to a bit, but it is not consistent yet," Russell said, adding that if the gas supply was restored at an adequate pressure, the primary textile sector's investment and production would also grow.​
 

RMG machinery, allied products mega-expo starts Jan 8 in Dhaka
UNB
Published :
Jan 05, 2025 22:34
Updated :
Jan 05, 2025 22:34

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A four-day international trade show on machinery for the garment industry and allied products is set to begin on January 8 in Dhaka.

The mega-exhibition is arranged to showcase the apparel industry's latest technology and garments accessories and packaging.

The event combining different trade shows will be held from January 8-11 at the International Convention City Bashundhara (ICCB) in the capital. It includes the 22nd edition of Garment Technology Show Bangladesh 2025 (GTB 2025) which is also known as International Tradeshow on Apparel Machinery and Allied Products and the 14th edition of International Garment Accessories and Packaging Expo 2025.

The trade shows will be organised jointly with the Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) and ASK Trade and Exhibition Pvt Limited. The GAPEXPO will be showcasing products, types of machinery, and raw materials.

Md Shahriar, president of the BGAPMEA, revealed this at a pre-event press conference in the capital on Sunday.

He said that the garments accessories and packaging industry acts as a backward linkage industry for the country's readymade garment (RMG) sector.

He also said that Bangladesh was fully import-dependent for RMG accessories and packaging materials earlier. Currently, over 60 items are produced locally for export-oriented apparel industries and some are also exporting directly.

He also said that to introduce the sector and to find buyers the GAPEXPO plays a crucial role.

In this year's tradeshow, about 500 exhibitors from 25 countries are showcasing the latest technology in terms of machines and software used in every process of production, he added.​
 

RMG exports grew moderately in 2024 despite headwinds

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In spite of turbulent times prevailing both at home and abroad, garment exports from Bangladesh grew in 2024 by 7.23 percent year-on-year to $38.48 billion, according to the Export Promotion Bureau (EPB).

This is due to an increasing demand for clothing with the fall of inflation in major export destinations.

Last year, the local garment sector witnessed demonstrations, national election-related movements, factory closures and production halts amid massive labour unrest after the fall of the Sheikh Hasina-led administration on August 5.

Goods shipment was severely affected in July, August, September and October due to a student-led mass movement culminating in Awami League's ouster and widespread labour unrest demanding wage hikes and an end to workplace discrimination.

On the international front, high inflation has persisted over the past few years because of far-reaching implications of the Russia-Ukraine war that began just after the pandemic, affecting consumer demand.

But Western economies have been rebounding gradually with rising demand, for which retail sales have also been growing with the clearance of inventories of previous years in Europe and the US.

Exports from the sector grew although many had thought that shipments would be negatively affected by domestic and external challenges.

For instance, garment exports in fact declined by 6.62 percent year-over-year to $2.38 billion in April, which came as a surprise given that the export trend was enjoying positive momentum.

Similarly, garment shipments declined last June by 10.48 percent year-on-year to $2.97 billion after increasing by 1.45 percent in January and 4 percent in March.

In July, apparel exports grew by only 2.89 percent year-on-year to $3.17 billion, as per the EPB data.

However, the exports rebounded strongly from September, growing by 14.61 percent to $3.01 billion that month and by 22.80 percent to $3.29 billion in October.

The trend did not stop there as the garment shipments grew by 16.25 percent to $3.30 billion in November before expanding again by 17.45 percent to $3.77 billion in December.

Exports started rebounding from September as normalcy gradually returned to the industrial zones after the labour unrest ended with factory owners accepting the 18-point demands of garment workers.

Moderate retail sales growth continued in November even as two of the holiday season's busiest shopping days bumped over into December and were not included in the month's totals, according to National Retail Federation (NRF), the largest US retail association.

"November sales increased on top of a strong October and would have been even higher if Thanksgiving Sunday and Cyber Monday hadn't fallen in December," NRF President and CEO Matthew Shay said in a statement.

"Year-over-year gains were solid even as retail prices in many categories are lower this year, showing that consumers are buying more merchandise as the economy continues to grow. We remain confident in our holiday forecast," Shay said.

Total retail sales, excluding automobiles and gasoline, were up 0.15 percent seasonally adjusted month-over-month and up 2.35 percent unadjusted year-over-year in November, according to the Retail Monitor.

That compared with increases of 0.74 percent month-over-month and 4.13 percent year-over-year in October.

In 2023, the garment export sector aimed for $50 billion in 2024 but adjusted expectations to $38.48 billion, marking a 7.23 percent increase from 2023.

The industry confronted challenges like wage protests leading to a 56 percent wage hike, said Mohiuddin Rubel, a former director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and additional managing director of Denim Expert.

Even after uncertainties from the national election, there was a 1.45 percent year-on-year growth in garment exports in January, he said.

A 60 percent cut in export incentives, compounded by global economic instability and volatile oil prices, affected consumer behaviour, he said.

Rising energy and transportation costs, along with high bank interest rates, hurt small and medium enterprises, causing closures, he added.

Despite a slight increase in exports in July and August compared to the same months of 2023, the figures for 2024 lagged behind those of 2022.

Rubel also said the outlook for 2025 depends on improved industrial relations and political reforms.

Former BGMEA president Faruque Hassan said garment exports would have been much higher had the challenges not been there. However, he expects 2025 will be a better year as normalcy is returning to the sector.

Exports grew not only in volume, but also value as international retailers' and brands' confidence in Bangladesh has been boosted, and the local currency was devalued, he added.​
 

RMG workers for Eid bonus equal to one month’s wage
United News of Bangladesh . Dhaka 10 January, 2025, 22:43

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Ahead of the Eid-ul-Fitr, to be held at the end of March, garment workers in Dhaka have issued a set of six demands, including a bonus equivalent to one month’s wage, as part of a broader call for fair treatment and improved working conditions.

The demands were voiced by the Dhaka Garment Workers’ Wage Increase Struggle Council during a rally held in front of the National Press Club on Friday.

Speakers at the rally highlighted the mounting pressures caused by skyrocketing living costs, arguing that current wages are inadequate to meet even basic needs.

Prices of essential goods keep rising, but the wages remain unchanged; it’s becoming impossible to survive, said one protester.

Workers accused employers of withholding portions of their salaries, forcing many to take on gruelling work schedules of 14-16 hours a day. Despite the labour law stipulation for double overtime pay, they claim employers routinely fail to comply.

The workers also criticised the widespread delay in salary payments. Under the law, wages are to be disbursed by the 7th of each month, but workers allege this deadline is rarely met. Many also condemned the practice of withholding wages until the night before Eid, calling it ‘illegal and inhumane.’

The garment workers outlined six primary demands: set minimum wages in line with rising market prices, limit workdays to 8 hours and enforce double pay for overtime, provide a bonus equivalent to one month’s wages for Eid-ul-Fitr, ensure salaries are paid by the 7th of every month, abolish the practice of withholding wages until just before Eid, enhance workplace safety, ensure job security, introduce equal pay for female workers, and provide health-friendly meals and night allowances for night shifts.

Speakers at the rally demanded fair treatment, better working conditions, and compliance with existing labour laws.​
 

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