Garments owners’ urge govt to ensure efficient ports, stable power and gas prices to remain competitive in the global market

Staff Correspondent        
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Garments manufacturers have urged the government to ensure efficient ports, stable prices of power and gas to help boost their businesses along with long-term policy support to remain competitive in the global market.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) organized the roundtable on October 4l in a city hotel. The participants discussed about the readymade garments sector’s (RMG) present situation and possible moves to improve while some of them also called for efficient functioning of all of the country’s ports for continued growth of apparel exports.

Mohammed Nasir, BGMEA Vice-President (finance) presented a keynote paper and BGMEA Ppresident Siddiqur Rahman moderated the roundtable. At the keynote presentation, Mohammed Nasir showed the present situation and the way out of RMG sector.

Figure 1: State Minister for Power Nasrul Hamid, Commerce Minister Tofail Ahmed and State Minister for Foreign Affairs Shahriar Alam attended in the BGMEA's roundtable discussion program.
Figure 1: State Minister for Power Nasrul Hamid, Commerce Minister Tofail Ahmed and State Minister for Foreign Affairs Shahriar Alam attended in the BGMEA’s roundtable discussion program.

According to BGMEA, Bangladesh’s export earnings from the apparel industry, the lifeline of foreign currency earners, have seen only a 0.20% rise to $28.15 billion, which is the lowest on record in the last one and a half decades, in the just-concluded fiscal year.

Figure 2: Bangladesh RMG export earnings growth lowest in last 15 years ( %). (Source: EPB)
Figure 2: Bangladesh RMG export earnings growth lowest in last 15 years ( %). (Source: EPB)

In this presentation, BGMEA showed the following main reasons behind the lower export growth in RMG Sector:

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Growth of RMG exports is declining most of the countries, including new market.

Table 1: The data is showing export growth situation in the main markets in FY2016-17 (%).
Table 1: The data is showing export growth situation in the main markets in FY2016-17 (%).

Bangladesh Textile Mills Association, BTMA President, Tapan Chowdhury said, “We want price predictability of electricity and gas so that we can plan for long periods for our business”. “Incentives to the primary textile sector would help it to supply more raw materials to the garment sector, which typically accounts for 82 percent of the export receipts”, he added.

Figure 3: Tapan Chowdhury, President, Bangladesh Textile Mills Association was delivering his Speech.
Figure 3: Tapan Chowdhury, President, Bangladesh Textile Mills Association was delivering his Speech.

“Price stability is a big factor for businesspersons” said, Dr. Mohammad Tamim, Professor, Petroleum and Mineral Resources Engineering, BUET. He urged the government to make a final decision on whether the businesses would continue with their private captive power projects to run their factories. He also said, “Garments industry should invest more for the infrastructural development.”

Newage Group Vice Chairman and former president DCCI, Asif Ibrahim suggested promoting the improvement and remediation in the apparel sector safety the country has achieved after the Rana Plaza disaster.  He also said that the government should provide fiscal and non-fiscal incentives for further development.

Figure 4: Asif Ibrahim, Newage Group Vice Chairman was delivering his speech.
Figure 4: Asif Ibrahim, Newage Group Vice Chairman was delivering his speech.

Mohammad Hossain, Director General of Power Cell, a technical arm of Power Division, Ministry of Power, Energy and Mineral Resources, urged the manufacturers to install latest technology and increase power use efficiency.

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“RMG manufacturers are working hard to face the challenges by introducing production engineering, technological upgrade etc. but it is not enough”, said Abdus Salam Murshedy, Managing Director of Envoy Group, former president of BGMEA.

Figure 5: Abdus Salam Murshedy, Managing Director of Envoy Group, former president of BGMEA was delivering his speech.
Figure 5: Abdus Salam Murshedy, Managing Director of Envoy Group, former president of BGMEA was delivering his speech.

“In continuation with the existing policy support, the government should offer special incentives, including 5% cash incentives on the value of Freight on Board (FoB)”, he added.

Addressing the roundtable, Commerce Minister Tofail Ahmed asked the Accord and Alliance, two foreign garment factory inspection agencies, to leave Bangladesh after their tenures end by June next year. The government might allow them at most six months’ time extension to wrap up their ongoing activities.

“The garment sector was hit by conspiracies spun by national and international players since exporters and the government announced a target to earn $50 billion from apparel exports by 2021”, he added.

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The state minister asked the manufacturers to increase contribution to the government exchequer while adding more value to their products.

Abul Kalam Azad, Chief Coordinator for Sustainable Development Goals (SDG) Affairs in the Prime Minister’s Office said, “Garments manufactures should invest more for promotion and Branding. Govt. works with BGMEA, BKMEA for skill development project especially in mid-level management in garments industry.”

Shahriar Alam, State Minister for foreign affairs; Nojibur Rahman, Chairman of the National Board of Revenue; and Shafiul Islam Mohiuddin, President of the Federation of Bangladesh Chambers of Commerce and Industry, leaders from industries, energy, banks, financial institutions and professionals also delivered speech at the round-table discussion program.

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