A new World Bank study “Stitches to Riches?” reports the Bangladesh RMG sector is well poised to take advantage of rising production costs in China. With more and more Chinese companies planning to offshore manufacturing as labour costs rise, the report highlights Bangladesh as an attractive location with huge potential to grow new export jobs. China has by far the biggest market share of the global apparel trade: 41% compared to Bangladesh’s 6.4%. If even only a small proportion of its garment manufacturers increase sourcing from Bangladesh, this can put the Bangladesh garment sector well on its way to achieving its goal of doubling exports to $50 billion by 2021. The study rightly highlights the need to invest in better compliance and higher productivity factories to help drive a virtuous cycle of more orders and growing FDI. As sustainability and environmental issues become ever more integral requirements for global consumers, Bangladesh’s manufacturers need to invest for the future and move up the value chain. It is encouraging to see Bangladeshi denim manufacturers lead the way in innovation by directly investing in the design and development of new products. As can be seen by the interest shown by leading buyers at last week’s Bangladesh Denim Expo, this is helping producers attract new orders through offerings of their own new designs. It is also benefiting buyers by spreading research and development costs and providing new pathways to innovation. The denim sector has shown foresight by investing in eco-friendly technology to cut water usage and produce more sustainable denim, with at least 28 factories certified by the US Green Building Council and another 120 already registered for setting up apparel units. The wider garment industry should emulate the innovation being shown by denim manufacturers to create better, more secure long-term jobs.
