Bangladesh: clothing, textile manufacturers undermined by demand for low prices

By

Matthieu Guinebault

Translated by
Isabelle Crossley

Published
Sep 28, 2018

Bangladesh no longer wants to remain content with entry level and value item production. This was the message that the country’s manufacturers had at the Texworld-Apparel Sourcing trade show when they argued that there is a large gap between the public demand of big brands giving orders and the direct investments made by these businesses to their manufacturers.

“We are grateful for all of the buyers who have helped Bangladesh to develop its textile and clothing industry over several decades,” said Abdullah Zaber, the chief executive of Zaber & Zubair.

“Bangladesh is now an expert in this field. International industry should take advantage of this expertise and give the country opportunities. I therefore, call on players in the clothing industry to not only place orders here for entry-level products but to also entrust us with a mix of products, both high-end and low. We are certain that we will not disappoint.”

This was a heartfelt message from a manufacturer who works on behalf of big fashion names including Zara, H&M, and Marks & Spencer and is from a country with an economy that has become largely dependent on textile exports. Textile exports make up 81 percent of Bangladesh’s total exports and totalled $28 billion last year, 14.07 percent of the country’s gross domestic product (GDP). The industry employs around seven million people in the country of which 90 percent are female. Many workers are currently facing social conflicts around minimum wage negotiations which the government had hoped to avoid. This conflict is heightened by the concurrent drive within the industry to meet higher environmental standards.

“Buyers appreciate the green revelation but sadly many of them do not become partners in this change,” said the industrialist Sajedur Rahman Talukder. “They are reluctant to add on even a single penny to invest in and run a green factory that respects these standards.”

This has been made all the more challenging because, after the Rana Plaza disaster, Bangladesh’s textile manufacturers have become the most scrutinised in the world by various authorities.

'UNFAIR DEAK'

“After 2013, ‘business as usual’ was no longer acceptable,” said Bangladesh’s Ambassador in Paris Kazi Imtiaz Hossain. “There are three organisations working for change: Accord, led by European brands, Alliance, a more American approach, and the Bangladesh government’s National Action Plan. 100 percent of factories have been audited and 90 percent have had their security conditions verified. This is a unique example of responsible business. We have complied with international standards and this has required a sizeable investment.”

These investments, according to a Bangladeshi exhibitor who wished to remain anonymous, are not respected by the brands that place orders.

“We present our collections and show the steps we have taken to improve working conditions and salaries and the investments we have made to be more eco-friendly… and buyers tell us that this is all very good, very appreciated, but we have to lower our prices. This is while we have already taken it upon ourselves not to raise prices despite the millions we have invested in our factories. I am talking about brands that triumph the importance of CSR in their collections. We get screwed!”

The Ambassador of Bangladesh made a more diplomatic statement: “We are expected to be in line with [industry] standards but there should be additional accountability. Clients are not ready to invest in the improvement process. The focus on competitive pricing is undermining our ability to modernise the sector. Indeed, Bangladesh has seven of the top ten green factories in the world and will become the world’s 28th largest economy by 2030.”

Feeling both hopeful and bitter, Bangladeshi manufacturers are acutely aware of the importance they attach to the West’s clothing industry.

According to the French Institute of Fashion, the European Union increased its clothing imports from Bangladesh by two percent in the first half of 2018 amounting to €8 billion worth of goods.

This makes Bangladesh Europe’s second largest supplier after China and ahead of Turkey and India. As for textiles, Bangladesh is Europe’s eleventh largest supplier totalling €189 million worth of textiles, up five percent on last year.