The clothing global retailers have not increased prices yet despite improvement of apparel manufacturing standards in Bangladesh, according to ready-made garment (RMG) manufactures.
Under the Sustainability Compact made by the European Union, USA, Bangladesh and International Labour Organisation in two and a half years ago, the retailers were supposed to raise prices of products after upgrading safety standards in the workplace, which increased production cost.
The local RMG makers’ claim of not keeping retailers’ promise came to the fore on the eve of second review meeting on “Sustainability Compact” – an initiative for improving safety standards and ensuring labour rights in the country’s apparel factories – which is scheduled for tomorrow in Dhaka.
BGMEA senior vice-president Faruqe Hassan told the Dhaka Tribune that as per the Compact, global retail brands were supposed to come up with fund to help execute manufacturers’ remediation process and promised to raise product prices, once the workers’ rights and workplace safety are ensured.
“But it is yet to see any light. Rather, they cut prices with the excuse of economic recession and devaluation of currencies.”
Hassan said: “We are not demanding massive price hike, but a reasonable one to offset our lot of expenditure on improving safety standards in the workplace.”
According to a study on “Prices and Development in the Global Apparel Industry: Bangladesh in Comparative Perspective”, prices of men and boys cotton trousers exported to the US market declined by 40.89% in the last 14 years. Mark Anner, associate professor at the Penn State University, conducted the study.
In a media briefing yesterday, BGMEA alleged that RMG global retailers failed to keep their promises on responsible business, though the manufacturers met conditions set by them to scale up safety standards and workers’ rights.
“Responsible business is one of the main pillars of the three conditions of the Compact. But in recent time, prices of clothing products in US and European markets, the country’s major export destinations, continued to slide, while wage implementation and workplace safety issues have shot up the production cost,” said BGMEA President Siddiqur Rahman.
For example, a factory had to spend Tk5 crore on an average to maintain safety standards, which is very tough for small and medium industries, he said.
As part of global value chain, responsible business ensures fair price and introduces unified code of conduct to help sustain the industry, Rahman added.
Commenting on the bio-metric workers database, he said already 4 lakh workers of 348 factories have been brought under the system and within a very short span of time, it will be completed.
Workers’ rights and welfare were ensured as the government has amended Labour Act 2006 and published rules of Labour Act keeping provision of 0.03% of export value to welfare fund and forming Elected Participation Committee and Safety Committee, said Rahman.
Bangladesh has become a role model of safety standard and buyers would not have to re-think to cut source from Bangladesh, he said, adding that 20 green factories have already been established while 100 are in the pipeline.
Following the deadliest Rana Plaza building collapse in July, 2013, Sustainability Compact was outlined for ensuring continuous improvements in labour rights and factory safety in the RMG sector of Bangladesh.
