Dr. Anu Mahmud :
Yet another fire at a garments factory has hit the country’s apparel sector with an unexpected blow when it is struggling hard to overcome the global outcry for safe workplaces to prevent fire and such other accidents. We fear that the new fire may cause additional concerns to the global retailers as to whether to continue outsourcing from here, besides bringing renewed pressure on the industry as to how quickly it would rebuild a fire and factory safety system which will be positively rated by the global community.
The fire at Aswad Composite Mills in Gazipur, which is a subsidiary of Pal Mal Group, has caused deaths to nine workers leaving as many injured. Reports said it had originated in the chimney of a heating machine and immediately spread to clothes which were on drying tables. But the way the fire spread across the entire factory was mysterious. Factory owner Nafis Shikder has declared that each worker who died in the fire accident would get Tk 5 lakh as compensation from the company, besides another Tk2 lakh as insurance benefits. The company will .also bear all the costs of treatment of the injured workers. He said, buyers have expressed condolences but did not make any negative gestures.
The fresh fire at another factory, after the Tazreen Fashion fire and Rana Plaza collapse made global headlines and we believe industry leaders and other stakeholders including the government and the workers would work together to put in place an effective check and recheck system of fire fighting and building design to avert more such disasters. The industry must not waste time to reassure the global community that it is seriously working to mitigate the problems. The fire at the factory started at day light and the deaths at the factory had taken place reportedly when some workers were trying to dodge the fire. Reports said the factory –which is one of the top safety compliant factories, had earlier trained many workers as fire fighters. The casualties had occurred mainly from such workers.
It is true that the country’s garments industry, which is the second biggest supplier to the global market next only to China, has equally become vulnerable to fire and such other accidents because of its very size. The inspection regime of the factories and monitoring of their production facilities should therefore be immediately upgraded at all factories and it is the responsibilities of all including the global retailers: We are heartened to know that the global coalitions of the US and EU retailers have already developed their factory inspection and verification regimes to allow a factory to make clothes for them only if they fulfil their compliance requirements. Their presence on factory floors may help overcome many shortcomings. A big industry may have some accidents, but the question is whether it occurs from human neglect. We believe retailers will take into consideration all these risky factor and stay with us.
NEWS reports said RMG export orders were being diverted to India and Vietnam in the recent past due to labour unrest, disasters at garment factories and the growing political tensions which are hitting buyers mind about the growing uncertainties of shipment.
The prospect of switching orders to India is growing large in the wake of the fall of the value of Indian rupee in terms of the dollar to mean that India may be able now to supply more apparels to US buyers at a lower cost.
The garment sector is the highest foreign exchange earner, but the export growth is coming down significantly from August due to the impacts of multiple negative factors beating over the huge export potentials of the nation. We urge the industry leaders to quickly settle the wage issue and restore industrial peace to keep the Bangladesh’s lead in the global market.
A story in a national daily, quoting president of Bangladesh Garment Manufacturers’ and Exporters’ Association (BGMEA) Atiqul Islam said a negative image, arising from the devastating fire in Tazreen Fashions and Rana Plaza collapse are increasingly distancing buyers from Bangladesh. As a result, he fears that the export target of this year may not be achieved and it may rather fall. He said buyers understand only business and profit, it is very natural that they will switch over to places that offer swift order shipments and also profit.
The apparel industry is the backbone of our national economy and it has potentials to establish Bangladesh as an economic power house in the world. But the sector is now facing various challenges such as improving working conditions at factories and fire safety.
As we know Bangladesh ranked ahead of Vietnam, Cambodia and Myamnar as having the greatest potential to increase export growth, as production moves away from China to Bangladesh mainly because of lower wages. But with the suspension of the Generalised System of Preferences (GSP) by the US government, the country’s image abroad has been badly eroded. This action comes as a result of the failure to move quickly to address the pressing issues.
Although Washington-based lobbyists have been making a case for Bangladesh’s GSP suspension for about a year now, the US pressure remains on quick compliance and improvement of workers safety and trade union rights at factories. We believe that all stakeholders will work together to reassure the global buyers that Bangladesh is serious in its attempts to restructure the industry at the earliest and buyers will stick to their source of supply in the country. Otherwise we may lose the bigger part of the market to other competent producers and suffer an incalculable loss.
The RMG sector has been facing some crucial problems both,at home and abroad. At least 112 workers died in a devastating fire that broke out in Tazreen Fashions at Ashulla in November last year. In April this year, more than 1,117 people, who were mostly female workers, died as the nine storied Rana Plaza building that housed five RMG factories collapsed. The US government suspended the GSP facilities for Bangladesh following the Tarzeen Fashions and Rana plaza tragedies. European Union and other major buyers of Bangladeshi garments are vigorously creating pressure on the Bangladesh government to improve health and occupational safety standards in export oriented garment factories in Bangladesh through determined action.
The International Labour Organization (ILO) has signed an agreement with the Bangladeshi garment industries aiming at helping nearly four million Bangladesh garment workers, recently beset by industrial accidents and a staggering loss of life, in getting essential support to improve working conditions, strengthen labour inspection and upgrade building and fire safety at the their workplaces. This agreement by the ILO will focus on supporting the Bangladesh’s National Action Plan for Fire and Building Safety developed in the wake of the Rana Plaza collapse. The action Plan calls for an assessment of all active export-oriented RMG factories in Bangladesh to be completed by 31 December 2013.
The RMG sector, which is the lifeblood of our economy, has been suffering from a nagging labour unrest which has had a crippling effect on the sector. The problem of persistent labour unrest often assumes the form of street agitation and violence of the most damaging kind. The workers often organise street demonstrations demanding higher wage and other benefits. The owners have to depend on the police to rein them in. The devastating fire that broke out killing at least 10 people will surely aggravate the vulnerable condition of the RMG sector. If things do not improve appreciably the RMG sector is likely to suffer from the persistent problems both at ‘home and abroad.
Belying speculations about adverse response following the Tazreen Fashions fire and Rana Plaza collapse, Bangladesh continues to be one of the top choices for garments buyers from the developed markets. The Bangladeshi apparel exporters at the opening of their annual event – Batexpo, an apparel and textile exposition, held recently mentioned the development apparently with a sense of great relief. They also referred to an uninterrupted flow of orders from the global retailers to Bangladesh despite, growing international concerns over safety and workers’ rights in a good number of (ready-made garments) RMG factories here. That the apparel owners have not made any false claim about the buyers’ response was proved by an article published next day in the Wall Street Journal (WSJ) of the USA. The daily said, apparel exports from Bangladesh increased by 24 per cent in the first quarter of the current fiscal year (FY).
The WSJ, quoting the finding of the survey, conducted by a principal in the Frankfurt office of consultancy Mckinsey & Co, said Bangladesh is likely to remain one of the top destinations for new apparel sourcing over the ‘next five years’. It said some top retailers have started to place production in emerging countries including Ethiopia and Myanmar, but it would take another decade to build up factories and other infrastructure needed to absorb large-scale orders. The WJS report highlights some factors that are bound to raise both hope and concerns for Bangladesh. Hope because of the fact that the buyers would continue to buy apparels from it, at least, for the next five years. But it has reasons to be worried about other developments. Emerging markets like those of Ethiopia and Myanmar could come up as serious competitors for Bangladesh since they would be offering apparels al low cost. This is the most important factor taken into cognizance by the international buyers, who do not have any special love for Bangladesh. Buyers put two factors – low cost and the capacity to deliver export orders on time – at the top of their minds Bangladesh, as of now, fits in well with their requirements.
But if some other countries could meet their requirement including those concerning workers’ safety and trade union rights the buyers in all probability would abandon Bangladesh and rush to those destinations. China is a glaring example. Though that country still holds on to the position of top apparel exporter, it business has been declining at a fast pace, particularly in the lower-end of the market segment, because of the cost factor. The buyers are no more finding China as an attractive source of procuring low cost apparels because of the rising cost of labour Bangladesh, thus, has to work out a safe mechanism to keep it cost of production low while offering ‘respectable’ wages to its millions of workers engaged in the apparel industry. The gap between the wages given to Bangladesh RMG workers and that given to workers in other exporting countries, is quite wide and it leaves some room for a ‘decent’ hike.
Besides, neither the administration nor the apparel factory owners, despite all the global concerns about factory safety and workers’ rights, seem to be serious enough to mend the lapses. Both have failed to make any major headway in the matters of compliance-related issues, not withstanding all the seriousness they show in public in this regard. The UN has also recently said, Bangladesh has not done enough on the issues of factory safety, following two major tragedies in the apparel sector. The government, the apparel industry owners and the workers would have to understand one fact that, buyers would soon find alternatives to Bangladesh if it fails to meet their requirements.
Meanwhile the following initiatives have been taken to reinstate GSP facilities in USA which has been suspended from the 27th of June 2013 and the continuation of GSP facilities in European Union:
(1) A delegation under the leadership of the Honorable Foreign Minister of Bangladesh visited Brussels and Paris to discuss with the Trade Commissioner of European Union and to present the initiatives taken by Bangladesh on working environment in RMG industry in the conference organized by OECD.
(2) Bangladesh, European Union and International Labour Organization (ILO) have adopted ‘Sustainability Compact’ with a view to take joint initiatives to improve labour welfare and safety of working environment. The United State of America has given consent to ‘Sustainability Compact’ on the 19th of July 2013.
(3) Regarding Bangladesh Action Plan 2013 proposed by United State of America to improve building and fire safety and working environment, ILO, Development Partners and the foreign buyers have jointly taken different initiatives which are as follows:
Accord on Fire and Building Safety in Bangladesh signed by European buyers;
Bangladesh Safety Alliance signed by North American buyers;
Improving working conditions in the Ready-Made Garments Sector a Project of $24.5 million proposed by ILO;
A project of Tk. 100 crore of JAICA for factory building inspection and relocation;
US $2.5 million project of the United State of America to ensure workers right and improve fire safety.
A project by GIZ to rehabilitate the disabled workers affected by Rana Plaza collapse.
(4) Bangladesh Labour (Amendment) Act, 2013 has been passed by the Bangladesh Parliament on the 15th July 2013 and Notified in Bangladesh Gazette on the 22nd of July, 2013. The Ministry of Labour & Employment has taken the initiative of formulating rules to implement the Bangladesh Labour (Amendment) Act, 2013 properly. Meanwhile a draft of the rules has been prepared by a technical committee. It is expected that the formulation of the rules will be completed by April, 2014.
(5) From the month of May, 2013 Government has appointed 42 inspectors to fill up the existing vacant posts. Appointment of another 12 inspectors is under process in the Public Service Commission. Upgradation of the Department of Inspection for Factories and Establishments with 679 new posts in the 1st phase has been approved by the Government of which 392 posts are exclusively for inspectors. The appointment of 200 new inspectors will be finalized by March, 2014. In the mean time additional secretary level official of the Government has joint as Inspector General of the Department.
(6) A proposal of increasing the number of inspectors from 50 to 310 in the Directorate of Fire Service and Civil Defense has been sent to the Ministry of Home Affairs.
(7) Two different proposals to increase the number of inspectors in the Rajdhani Unnayan Kartipakshya (RAJUK) and Chittagong Development Authority (CDA) has been sent to the concerned ministry. Meanwhile the proposal of the Rajdhani Unnayan Kartipakshya has been approved.
(8) An Inter Ministerial Committee headed by the senior secretary of the office of the Prime Minister has been formed to examine the implementation of Bangladesh Labour Act, 2006 in Bangladesh Export Processing Zone and the committee has been working to submit the report.
(9) The Department of Fire Service and Civil Defense has initiated a hotline regarding fire safety. The Bangladesh Telecommunication Regulatory Commission (BTRC) has been assigned two 4-digit dedicated numbers for the hot-lines for the Department of Labour (DOL) and Department of Inspection for Factories and Establishments (DIFE). The installation process is in progress. Hopefully the process will be completed by April 2014.
(10) ILO has been requested to incorporate in the project proposed by them to develop a database open to all based on the information relating to formation of trade union, labour right, building and fire safety inspection etc. in the garment factories.
(11) The government has withdrawn the cases against Kalpona Akhter and Babul Akhter.
(12) Concerned police station has submitted charge sheet against the accused Mustafiz in Aminul murder case to the concerned court. The case is now under trial.
(13) The Ministry of Social Welfare suspended registration/re-registration of Bangladesh Center for Women Solidarity (BCWS) and Social Activities For the Environment (SAFE) on the basis of the proposal of National Security Intelligence. The ministry, in the meantime, has withdrawn the suspension orders. The two organizations are now continuing their activities.
(14) Trade Union registration is being continued and 127 trade unions have been registered in the RMG sector since January 2013 so far.
(15) Legal steps have been taken by the Department of Labour against the factory authorities who are involved in unfair labour practices regarding trade unions.
(Dr. Anu Mahmud, is an author and columnist. Email : [email protected])
