As Syed FaizulAhsan walks through his own garments factory located in Dhaka (the outside Capital of Bangladeshi), he felt that he step with a spring in his foot. Workers on his factories are very busy in manufacturing sweater for an overseas client. Hundreds of his workers are from rural areas and the majority of it is woman. MrAhsan’s unit is the one who is most popular factories among the other factories in Bangladesh even though its setting is just the same with thousands of factories there.
China is the one among other countries who export the biggest share of garments from Bangladesh. The sweaters made in his unit are not heading to the US or Euro zone. Emerging orders from mainland China denote that MrAhsan can breathe easy regardless of the low demand from the US and euro zone.5% of my factory output was for Chinese clothes market a few years ago but now, it increase in 20%, he says.”He also expects that it will continue to rise for these coming years.
It may sound weird that Chinese firms are turning to Bangladesh to make clothes, for the reason that China is the comprehensive leader in clothing manufacturing and exports in the whole world. Only around $70 to $100 are the Bangladesh average monthly salaries for garments every month but if I, I will make it more competitive.
Rosa Dada of Four Seasons Fashion Limited, a Chinese garments producer, says factories in China are not competitive any longer for the reason that of its increasing wages of laborers and a sharp hike in overall production costs. It’s been two decades since Ms Dada systematize garments factory in the Chinese port city of Ningbo. She tells me throughout her current vacation here in Bangladesh to look for opportunities that her factory in China, the salary of workers has been increasing steadily over the last few years.
It has reached around $400 to $500 (£250 – £315) a month per worker. If I continue to produce there, our business will be bank crop. In Bangladesh the regular monthly wage for garments workers is only around $70 to $100. If I produce here, price is much more competitive.”She has previously opened an office in Dhaka as well as is not just looking to order clothes for her own firm however is also involved in getting other Chinese online retailers to source from Bangladesh. Some Chinese Clothing Company if they will get clothes from Bangladesh, prices may decrease by 10% to 15% depending on the category.
A new beginning
The further advantage enjoy by the Bangladesh garment exporters are they produce more that 90% of product going to the counties (as T-shirts, jeans, sweaters and casual trousers enjoy duty free access to the Chinese market).The grouping of lower labor costs as well as duty free access means that orders from China are likely to receive a boost in the approaching years. Few years ago, only $19m of Bangladesh clothing exported to China but now it’s already more than $100m.
The delivery in China in this coming 5 years will increase in $500m. Bangladeshi factory owners already expect it. China’s largest online clothing retailer has already shifted a portion of its shirts and casual trousers orders to Bangladeshi factories according to Chinese media reports.
In the meantime, western fashion brands such as Ocean and H&M are also making clothes for Chinese customers in Bangladeshi factories.”I think it marks a new beginning for our exports,” SiddiqurRahman, vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), tells the BBC.”At a time when western economies are going through recession, Asian countries like China, Japan and India are opening up for us.”
Our prices are low. That’s why big western fashion brands are coming here. If they increase their buying price, we will also increase our salary to the workers”
There has been a main worry for the clothing manufacturers said by the Bangladesh’s creaky infrastructure and political instability. Additionally, there have been violent labor complaints current months ago in the workers demanding for improved salary and setting. Bangladeshi clothes manufacturing workers are among the lowest paid in the world for this type of work, says by Labor activists.
The murder of a well-known labor activist, Aminul Islam, prior this year has only added to the insecurity among the factory workers. Subsequent protest by western campaign groups over wages; major global retailers like Walmart and GAP have urged the country’s factories to increase wages. However Bangladeshi business leaders are disobedient say that they have recently increase salary in the sector and notify that any further increase may damage its competitiveness.
MrRahman says, “Our prices are low, that’s why big western fashion brands are coming here. If they increase their buying price, we will also increase our salary to the workers, “Nevertheless as the nation try to increase ground as a lower-cost alternative to China, local workers’ conditions will come under increasing analysis. Manufacturing players will have to find the right equilibrium among upholding competitiveness, meeting labor demands and keeping their buyers contented.That may prove to be the toughest test for the sector yet.
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