Without an increase in prices to go with the higher wages, the new wage structure could lead to the closure of a number of RMG businesses, he said
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) on Monday said that the implementation of the new wage structure for apparel workers would be a major challenge for the sector,and may lead to the closure of a number ofreadymade garment (RMG) units.
“For us, it is a major challenge to implement the new wage structure. Buyers, workers, the government, and other stakeholders have to come forward and work togetherto this end,” Md Siddiqur Rahman, president BGMEA said at a press conference at his office in Dhaka.
On September 13, the Bangladesh government set Tk8,000 as the minimum monthly wage, with Tk4,100 as basic salary, for the country’s apparel workers. The new wage structure is set to become effective from December.
“In a letter to Bangladesh Prime Minister Sheikh Hasina, the American Apparel and Footwear Association urged the implementation of a new and inclusive wage structure in the RMG sector. The prime minister has done her job and increased the workers’ wages, so we think buyers now have a responsibility to increase the prices they pay for products,”the BGMEA president said.
Without an increase in prices to go with the higher wages, the new wage structure could lead to the closure of a number of RMG businesses, he added.
“From 2014-2018, about 1,200 RMG factories had to shut down their operations. We predict that we may see more closures in the near future due to the new wage structure and other factors,”Siddiqur said.
He also said prices of Bangladeshi apparel goods had seen an 11.72% fall in the US market, which is the single largest export destination for Bangladeshi goods.
Furthermore, the BGMEA president urged trade unions and other stake holders not cause conflict regarding the new wage structure by spreading incomplete information.
“From different sources, we have heard that some NGOs and a handful of labor leaders are spreading propaganda and manipulating other active and sincere workers to create anarchy in a peaceful sector.This is utterly unacceptable,” the BGMEA leader claimed.
“The National Garments Workers Federation, a trade union, distributed partial and distorted informationabout the minimum wage among the people,”Siddiqur said.“They compared the wage structure to that of 1998, 2006, and 2010, but shrewdly avoided 2013. Moreover, they said the 7th grade labour rate is 3-5%, when it is actually more than 20%.”
“There are a few groups who would be happy to create problems, but if this sector faces problems then it will be the workers who will be worst affected. It would further create an imbalance in the socio economic ecosystem. It is better not to provide manipulative and partial information, which can destabilize the industry, provoke workers, and tarnish the global image of the sector,” he added.
BGMEA Senior Vice President Faruque Hassan, and Vice President Mahmud Hasan Khan Babu were also present at the press briefing.