Bangladesh economists and manufacturers urged the international buyers to deconstruct the current value chain of Bangladeshi apparel products to ensure better price.
“The country’s garment sector operates in a deeply unjust global value chain where a $5 shirt made in Bangladesh is sold at $25 at Wal Mart stores or at much higher prices in countries such as Sweden,” said eminent economist Prof Rehman Sobhan.
“Where exactly does the $20 go? Is this a natural working of the market mechanism or a manifestation of an unjust global order?,” he questioned while addressing a seminar styled as “Catalysing social dialogue in the RMG sector of Bangladesh” held at hotel in Dhaka on Sunday.
Centre for Policy Dialogue (CPD) and International Labour Organisation (ILO) jointly organised the event marking the fourth anniversary of Rana Plaza tragedy.
Distinguished Fellow of CPD Debapriya Bhattacharya moderated the discussion while Secretary of Ministry of Labour and Employment (MoLE) Mikail Shipar, Vice-President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Mahmud Hasan Khan Babu, President of National Garments Workers Federation (NGWF) Amirul Haque Amin and Secretary General of Bangladesh Trade Union Shangha (BTUS) Chowdhury Ashiqul Alam spoke, among others.
Rehman Sobhan said the current business model forces suppliers to squeeze their workers as much as they can as they would have to produce the shirt within $5.
“Unless there is a major investigation of professional nature, political nature and in the end of the day international nature, the Oxfam and Action Aid, and everyone has to join together to deconstruct the value chain,” he added.
Former President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Fazlul Haque said: “Selling a product by $5, we, the manufacturers have to give all the detail information how the price comes at $4.95 not $4.75, what is the costing of factory, what is the costing of labour, what is my profit; each and everything, that buyers called, ‘open costing’.”
“I would like to request the international buyers only one thing: just mention in your products tag that the selling price of the product is $25, while the buying price was $3 or $4 or $5. I think, if you (buyers) can do this, all the problems will be solved regarding unjust value chain,” he said.
BGMEA Vice President Mahmud Hasan Khan Babu said the buyers threatened Bangladeshi manufacturers to shift their sourcing in other competitor countries, while they demanded a just value chain.
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.