BGMEA president urges workers not to go on strike
“Developed countries have raised interest rates and mortgage rates to control inflation, reducing consumer purchasing power and retail sales, and causing global commodity prices to fall," he also said Faruque Hassan, president of the BGMEA
The indefinite strike from 1 January planned by labour rights organisations "is a vicious attempt" to destabilise the garment industry, Faruque Hassan, president of the BGMEA, said on Friday (29 December).
"Some organisations have announced to hold a labour strike in garment factories from 1 January 2024, which is totally undesirable," the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president also said in a press statement issued on the day.
On Saturday (24 December), the Sammilita Sramik Parishad, an alliance of 10 labour rights organisations, announced that the workers of the country's garment sector would begin an indefinite strike from January 1 if their demands were not met by 31 December.
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Speaking at a discussion at Dhaka Reporters Unity in the capital, the alliance leaders also announced that the factories would remain closed until their demands were met.
The Israel-Hamas war that has started in the meantime has appeared as an ominous signal in front of the world economy, as well as our country's economy, especially the garment industry
Indicating a reference to the alliance's announcement, Faruque said, "Such a programme can never be supported, rather, we feel, it is an attempt to destabilise the industry.
"At a time when we are going through a difficult situation in the national and international arena, any programme carried out in the name of strike will disrupt our economy, give a negative message about the industry to the outside world and create doubt among the buyers, which is not at all desirable."
US apparel imports from Bangladesh declined by 24.75% in dollar value and 29.51% in volume terms
In the written statement, he said the garment industry was still struggling to recover from the economic impacts of the Covid-19 and the worldwide surge in inflation due to the Ukraine-Russia war.
"Developed countries have raised interest rates and mortgage rates to control inflation, reducing consumer purchasing power and retail sales, and causing global commodity prices to fall. The Israel-Hamas war that has started in the meantime has appeared as an ominous signal in front of the world economy, as well as our country's economy, especially the garment industry."
Apparel trade declining amid surging production costs
Meanwhile, outlining the global and Bangladesh's garments market's performance in recent months, the BGMEA president said garments exports from Bangladesh to major markets have declined in the first 10 months of this year.
"In the first 10 months of 2023, US apparel imports from around the world decreased by 22.71% in dollar value and 23.80% in volume terms. At the same time, US apparel imports from Bangladesh declined by 24.75% in dollar value and 29.51% in volume terms.
Expenditure increase in electricity, gas, diesel, transport cost and other sectors is having a negative impact on production cost
"EU apparel imports from the whole world fell by 13.14% in dollar value and 16.74% in volume terms during the period. Also, EU garment imports from Bangladesh decreased by 17.32% in dollar value and 17.13% in volume terms.
"Thus, global apparel imports have slowed down and the unit price of apparels have also declined in 2023 compared to 2022. In this scenario, we expect global apparel trade in 2023 to be lower than in 2022."
He went on that the decline in exports is also reflected in the downward trend in imports of capital machinery and raw materials.
"During July-October of the current fiscal year, our back-to-back LC openings have decreased, imports of machinery/parts of the garment and textile industry have decreased, and container handling at Chittagong Port has also decreased significantly. Almost no new employment has been created in the garment industry in the last one year.
"Moreover, a major concern for the industry is that our cost of production has increased at an alarming rate in recent years. Expenditure increase in electricity, gas, diesel, transport cost and other sectors is having a negative impact on production cost.
During July-October of the current fiscal year, our back-to-back LC openings have decreased, imports of machinery/parts of the garment and textile industry have decreased
"Since July this year, the Bangladesh Bank has increased interest rates to control inflation, which has further increased our cost of financing, which in turn has led to an increased cost of production of goods.
"Also, various registration and certification fees including bank charges and fees of municipalities and city corporations have increased significantly.
"Over the past decade, factories have invested millions of dollars in renovations, and we are continuously investing in areas such as environmentally friendly production, carbon emissions reduction, efficiency gains, etc. to meet new international due diligence requirements."
The Sammilito Labour Parishad called the latest strike from 1 January to push home their demands of trial of those responsible for deaths during the wage hike movement; treatment of injured workers; release of arrested workers; reinstatement of dismissed workers; and review of wages announced in the garment sector in favour of Tk25,000 minimum wage.
At least 19 workers' rights groups and federations expressed solidarity in the programme, according to media reports.
The new protest programme comes following massive countrywide protests by RMG workers in recent months in demand of hiking the minimum wage in the sector.
The protests, which began in late October, lingered till 12 November.
During the unrest, at least four workers were killed, hundreds got injured, while 26 factories were vandalised, and two were torched.
Factory owners and police filed dozens of cases against workers and trade union leaders, and over a hundred workers were sent to prison.
Following the unrest, the Minimum Wage Board for the readymade garments sector today finalised the increase of RMG workers' minimum wage to Tk12,500 from Tk8,000, an increase of 56%.
