Great News!!! Bangladesh is building ‘garment villages’

07 Sep 2015

Great News!!! Bangladesh is building ‘garment villages’

September 07, 2015Market Watch

The speedy development of garment industry in Bangladesh is seeing both blessed and burden situation. It has been observed that this situation has provided jobs and helped cut the poverty rate.

Already the world’s second largest exporter of clothing by some estimates, Bangladesh intends to double its apparel exports to $50 billion by 2021.

Recently, Tofail Ahmed – commerce minister announced the plan which includes the creation of a “garment village” in the southeastern port city of Chittagong. It will be a major export hub to support the country hit its goal. The garment village has one already under construction in the city of Bausia which is funded by a state-owned Chinese firm. The Bausia village is projected to have more than 200 factories and contribute up to $5 billion in export value.

Government plans for a garment village have apparently been fluctuating around since as early as 2005. However, the concrete decision was taken only after the deaths at the Tazreen factory fire and Rana Plaza.

Bangladesh - Clothing Industry

The garment village shows commitment by the government in two ways:

  1. To encourage more money off the garment industry (accounting to nearly 82% of Bangladesh’s total exports) and
  2. To make workers conditions safer.

As of now, factories got spreaded across in an unplanned manner making it harder to monitor and at the same time developments happened wherever space was available.

Some things to watch:

  • Regulations such as workplace, health, and fire safety regulations will be enforced.
  • Factories that don’t currently comply with regulations such as workplace, health, and fire safety regulations and so on will be moved to the villages.
  • It will include facilities for medical treatment, proper waste disposal, and so on.
  • Day care will be provided as 80% garment workers are women.

A recent paper by the World Economic Forum, a garment worker’s pay in Bangladesh has a smallest share of the final cost of a t-shirt. It is also noticed that workers make far below a living wage.

Bangladesh - Cost of T-shirt

All of the above, the US – largest importer of garments from Bangladesh has also agreed to support the Chittagong plan and assist the country to achieve the target of doubling exports. Further, US has join hands with two Bangladeshi banks to offer $22 million credit guarantee on loans to support improve safety in garment factories.

All sound positive and will surely create more jobs.

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