Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will relocate 34% of their active factories in an effort to improve safety and the working environment.
The relocation of 1,200 factories out of 3,600 would be done with the financial help of Japan International Cooperation Agency (JICA), BGMEA Vice President Md Shahidullah Azim told the Dhaka Tribune on August 4.
The trade body would sign a Memorandum of Understanding (MOU) with JICA after the Eid vacation to get the fund, said Azim, who is also the managing director of Classic Fashion Concept Limited.
He said the relocation, retrofitting and rebuilding of identified factories would be done in phases considering the present status of the buildings.
Firstly, they would relocate vulnerable factories; secondly, the factories housed in commercial or residential and rented buildings; and thirdly, shared buildings. Azim said the buyers do not like shared factory buildings as they may create hazardous situations.
"The initiative of factory relocation has been taken in a bid to improve the country's garments sector, as we have witnessed a disaster following Rana Plaza building collapse, which brought a wide range of criticism of workers' safety," said a BGMEA director.
To avoid untoward incidents and to ensure a safe working environment, the BGMEA has been working hard with the help of world organisations, he added.
Earlier, Bangladesh Bank and Japan International Cooperative Agency (JICA) jointly announced a Tk1bn fund to provide easy loans for retrofitting and rebuilding the vulnerable apparel units and improving safety standards in the labour-intensive industry.
As per the announcement, the interest of the special credit will not exceed 10% per annum - 5% for JICA and the rest for the banks to be involved in the loan disbursement process.
The factory owners will enjoy the loan facilities at 10% and the loan will be provided for a period of up to 15 years with a two-year grace period. The scheduled banks will get the refinance fund at 5% interest.
Rana Plaza, an eight-story commercial building having housed five factories, collapsed in Savar on April 24, leaving at least 1,127 workers killed and over 2,500 injured.