Sustain advances in RMG sector
It is a realistic view that Bangladesh now stands a unique opportunity of achieving the number one RMG (ready made garments) band in world market if it can successfully carry out some ongoing reforms and upgradation in the RMG sector. It will be another milestone Bangladesh can achieve on the way of achieving full fledged mid income country status .
Cheap but hard working honest labour, cheaper gas and power helped develop Bangladesh grow into a preferred brand of ready Made Garments (RMG) in the world market. In our usual visits to shopping malls in Northern America, Western Europe, Middle Eastern countries and even in Australia we come across made in Bangladesh quality garments products almost everywhere.
But some incidents of fire and building collapse with special mention of Tajrin Garments and Rana plaza dented Bangladesh Garment sector reputation quite a bit. But as far as competitiveness and quality Bangladesh RMG is still number two band just behind China in world market. With China intending moving out of low end RMG products gradually, Bangladesh stands a huge opportunity of claiming the Number One band if we can make some very critical reforms and upgrading of our RMG industry. This prospect has further heightened with the recent Chinese announcement of withdrawl of all tariff restrictions on the entry of Bangladeshi made garments products in the vast China market.
Let us try to assess what are the present challenges and what needs to be done?
Some quarter believes USA keeping suspended GSP from Bangladesh RMG will cause major impediments. But the continued growth of RMG export even after US withdrawal of GSP proves the apprehension wrong. USA is only part of Bangladesh market of RMG. Bangladeshi RMG is still enjoying preferred brand advantage in EU Countries , Canada , Eastern European countries and in some Middle eastern countries.
The important state visit of PM Hasina to China among other milestone achievements of potential China Bangladesh cooperation and collaboration also achieved major stepping stones in RMG sector.
Bangladesh and China have agreed on setting up modern self-contained garments village on the outskirts of Dhaka city at Gazaria. In addition to that China will have an exclusive Chinese industrial zone where Chinese investors will also set up export oriented RMG factories and products will be exported as Bangladesh brand. Even the Japan visit has also opened avenues of Japanese investors making Bangladesh their preferred locations for setting up industries including RMG.
There is no denial that enabling environment for RMG and competitive edge of Bangladesh RMG in world market led to mushrooming of RMG industry of RMG factories in the city centers of Dhaka and Chittagong cities and suburbs. Many foreign nationals working in Bangladesh RMG sector hardly cared for providing minimum working environment and facilities of low earning RMG workers. After a few hiccups present government is desperately trying to address the issues of RMG sector bringing discipline and creating accountability. In the recent past high powered committees have conducted surveys and auditing and implementation process of their recommendation is in place.
For better control and management all RMG factories from the heart of the major city centres should be phased out and relocated to properly planned RMG villages having better organized and reliable utility services , world class safety and security arrangements , accommodation , health care facilities of RMG workers. Minimum wages and fringe benefits must be reviewed. RMG workers getting at least US$ 250-300 will not cause much reduction of profits of huge earning of RMG owners.
For security and safety of RMG workers and the industry a special police unit as RMG Police or in a larger concept Industrial police unit can be created. It may have a sub unit named RMG Intelligence unit for surveillance of possible subversive activities in our RMG industry. All foreigners working in RMG must have valid work permits and their records must be maintained and monitored.
We must appreciate the RMG boom has done a great work in our poverty alleviation as a special section of village girls are now self-dependent and supporting their families as well. They must get due respect from society. Facilities like day care center, community clinic, adult education, etc. can be set up in the special garments village for them.
Sajib Wazed IT adviser of PM Hasina is in a mission of digitizing different key sectors of Bangladesh. One of his prime objectives must be digitizing RMG sector which is the major revenue earner for Bangladesh. Let all RMG factories be digitalized and reliable database created and preserved of all RMG related data and information. This will enable centralized monitoring of all RMG related business and commercial operations including safety and security. The information among others must include data base of all workers and executives working in RMG including their nationality, salary and benefits. Some officials of each RMG must be trained to introduce IT facilities in each RMG.
Bangladesh Foreign missions and Ministry of Foreign affairs must work to promote to expand RMG market access in countries which may be potential new buyers.
Government may consider a preferential special pricing of gas and electricity for export oriented RMG factories and Tax holidays and other benefits for modern RMG units for a given time. Bank loans of easier terms should be considered as incentives for owners for relocating the RMG from existing locations to properly set up RMG villages. Export credits and other facilities may be thought of. Also government can encourage investors in setting backward and forward linkages of RMG industries for achieving more self-reliance.
Opportunities have emerged for Bangladesh in achieving number one RMG status now. We must grab it with both hands. Let China, Korea, Japan be our partners in progress in achieving this dream.