Bangladesh’s readymade garment factories, which are insolvent but willing to maintain international standard, are likely to get a US$ 113-million fund as loan to improve their standard. “This is basically for small and medium factories which can’t afford the cost [involved in reforms process],” BGMEA Vice President M Shahidullah Azim told UNB on Friday, reports UNB. Azim, also Managing Director of Classic Fashion Concept Ltd, said around 40 percent of the RMG factories are of small and medium categories. Responding to a question, the BGMEA leader said the fund will come through Agence Française de Développement (AFD), France’s national institution working for development and the International Finance Corporation (IFC). The IFC will provide US$ 50 million while AFD US$ 63 million which will be purely loan, not grant under remediation programme. “We’ve told them to fix the interest rate at 4 percent,” Azim said adding that the matter is under discussion with relevant stakeholders. The issue of funding was also discussed at a meeting held at the Foreign Ministry on Thursday which was part of the ongoing process of ‘3 plus 5’ to get how to support Bangladesh’s RMG sector. The BGMEA sources said the issue will further be discussed with the Economic Relations Division. The Economic Relations Division (ERD) has also been given the responsibility to negotiate with the development partners and agencies. Asked how the factories will get this support, Azim said the interested factories will apply for the fund following certain procedures to be fixed later. Industry insiders said this initiative will help the insolvent and unsafe RMG units comply with the rules and regulations in line with the international standards. On Thursday, the Commerce, Labour and Foreign Affairs Secretaries and the envoys of five countries here, including that of the USA, reviewed the progress of reform programmes in the country’s readymade garment industry. European Union (EU) Ambassador in Dhaka Pierre Mayaudon, US Ambassador Marcia Bernicat, Senior Commerce Secretary Hedayetullah Al Mamoon, Foreign Secretary M Shahidul Haque and Labour Secretary Mikail Shipar were, among others, present. The countries like the USA, Canada, Germany, the Netherlands and the EU reiterated their commitments to help the sector grow. The diplomats expressed their happiness at the progress describing it as a ‘very promising sign’, and said they want more progress. The RMG industry has grown over the space of a few short decades to become the second largest in the world. The RMG sector has become a key driver of the Bangladesh economy and the nation’s development. RMG exports totalled US$24.5 billion (2013-14) accounting for over 80% of the nation’s export earnings and employing some 4.2 million workers, 80% of whom are women.
