Trade deficit almost doubled in the first ten months of the just-concluded fiscal year owing to slow export growth as a result of the image crisis of the garment sector that rakes in the bulk of the receipts. Between the months of July and April last fiscal year, trade deficit reached $8.5 billion from $5.51 billion a year earlier, according to central bank statistics. During the period, exports grew only 2.67 percent against the government projection of 10 percent for the whole of fiscal 2014-15. In light of the poor performance, the government has revised down the export target to 5 percent. The targeted growth could not be achieved due to the sluggish Eurozone economy, appreciation of the taka against the euro, and the ongoing process of improving the working conditions as well as protecting labour rights in the apparel industry, Finance Minister AMA Muhith said in his budget speech. “I believe that with the prospect of positive growth in the trading partner countries and the ongoing reforms in the garment industry, exports will soon gather momentum,” he added. Meanwhile, imports registered strong growth, leading to the widening of the negative trade balance. In the first eight months of fiscal 2014-15, imports grew 12.19 percent in contrast to 9.13 percent a year earlier. A fall in garment exports has caused the country’s trade deficit to double in the first 10 months of the last fiscal year. Muhith credited the buoyant domestic demand for the higher import growth. In particular, the import of capital machinery has substantially increased, indicating an expansion of production capacity in the near term. In the first 11 months of last fiscal year, capital machinery imports increased 20.76 percent, which was 16.96 percent a year earlier. An increase in capital machinery imports indicates that investment and export are poised to grow.However, raw material imports increased only 3.52 percent during the period, in the line with the export performance. It increased 12.53 percent a year earlier. Subsequently, the government has set a pragmatic growth target for both export and import this fiscal year: 12 percent for exports and 11.5 percent for imports. The export receipts are projected to grow at an annual average rate of 12 percent in the medium term owing to a gradual recovery in key export markets, the government said in its Medium Term Macroeconomic Policy Statement. Given the improvements in labour right and factory safety standards, the image of Bangladeshi garment industry will be brightened in major export markets, it said. On the domestic side, the government’s initiatives to augment power generation and reduce other supply bottlenecks will enable exporters to exploit their production capacities, reduce lead times and create a more conducive environment for expansion. The new measures to implement a number of economic zones are expected to accelerate export growth, the statement added.

After conquering the global apparel market, the country’s garment makers have now turned their attention to the domestic market, hoping to repeat their success. Over the last one year, at least five export-oriented garment makers — who have been supplying clothing items to Western brands like Walmart, Hugo Boss, JC Penney, H&M, Marks & Spencer and so on for decades — have opened plush stores in Dhaka. The size of the domestic fashion market will cross $5 billion a year, according to industry insiders. At present, the majority of the demand is met by local manufacturers, with some items being imported mainly from India, China and Pakistan. “This is the high time to grab the fashion business in Bangladesh as people are becoming fashion conscious with their rising income,” said Shah Rayeed Chowdhury, director of Noir, a local brand of export-oriented Evince Group. Noir, which opened its first store in Dhaka eight months ago, has two stores running in the capital. The company plans to open two new branches in Dhaka by the end of this year and a few more outside the capital after that. “The response from customers has been amazing,” Chowdhury said, adding the youth are Noir’s target. Another successful brand name is Yellow by Beximco. Yellow is not only performing well in the domestic market but also in Pakistan, where it has four stores, said Shehryar Burney, executive director of Yellow. Yellow was started in 2004 because Beximco noticed that the global growth was shifting from the Western economies to Asia, he said. “China and India have had seen a transformation where local markets became a strong source of growth and profits for the brands that were able to capture market-share.” Bangladesh, with its strong economy, is poised to follow the same path, Burney added. With higher incomes and more prosperity, young consumers are more likely to emulate global trends and focus their consumption on items that enhance their social status, rather than on basic necessities, according to Burney. Yellow now has eleven stores in Bangladesh, and plans to expand the brand footprint to other countries. The company also has distribution partnerships in Algeria and India, and is negotiating to get a brand presence in Thailand and Singapore, Burney said.  Yellow has a design team led by top designers who have experience at renowned brands such as Pepe Jeans and Massimo Dutti. Epyllion Group, which supplies garment items to western consumers, has opened five stores in Dhaka in the last five months under brand name ‘Sailor’. “Bangladesh has a very big market as the country has a big young population, and income is also increasing every year. So, we started the business in the local market mainly targeting the middle-income customers,” said Rezaul Kabir, assistant general manager for business development of the group. Kabir, without giving his company’s turnover, said the sales growth has been above expectations, as the rush of customers is very high, especially during the Eid season. The majority of the fabrics are from the group’s own factories and some are imported. The watches, shoes, belts and other accessories for both males and females are imported from China and Singapore. Partex Group, which is one of the country’s leading denim fabrics makers, has also joined the race. Showkat Aziz Russell, managing director of Amber Lifestyle, a venture of Partex, said one day Bangladesh would have one of the leading garment retail brands worldwide. “People never imagined Bangladesh would be the second largest apparel exporter worldwide, but it is a reality now, although we don’t produce cotton. We will be one of the leading garment retailers in future.” Amber Lifestyle carries the company’s own garment items as well as imported accessories for both men and women at its four stores in Dhaka.

The Japan International Cooperation Agency (JICA) and the Ministry of Textile Industry held a meeting on Thursday to work out parameters for the project of “Skill Development and Market Diversification” (PSDMD) for the garment industry. JICA Senior Advisor Takafumi Ueda and Ministry of Textile Industry Secretary Amir Marwat led the meeting held at the Ministry of Textile Industry. It was mutually agreed in the meeting that JICA experts would facilitate the garment sector, specially the small and medium enterprises (SMEs), in the field of international marketing practices along with compliance requirement, marketing and product diversification. The second component of the project would focus on capacity building of the two Export Development Fund (EDF) institutes, Pakistan Readymade Garment Technical Training Institute (PRGTTI) and Pakistan Knitwear Training Institute (PKTI), managed by the Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) and the Pakistan Hosiery Manufacturing Association (PHMA) respectively. The JICA experts would impart training and provide necessary machinery for the institutes. The third component relates to training institute at Faisalabad Garment City. Takafumi Ueda said, “JICA previously coordinated with the textile sector of Pakistan in 1993 by helping upgrade the National Textile University Faisalabad. The new project would open a new era of cooperation between JICA and Ministry of Textile Industry, as JICA would provide technical assistance in different fields of textiles sector.” Amir Sarwat highlighted that Pakistan has inherent advantage of being 4th largest producer of cotton in the world with a huge potential to further increase crop yield. For success of any export led Industry, local availability of basic raw material is considered as an added advantage. The Textile Industry secretary praised JICA for providing technical support to the textile industry. He said that this project would facilitate in achieving goals and objectives set forth in the Textiles Policy 2014-19. “The project would be beneficial in imparting higher skills in the area of garments along with market and product diversification of textile sector which are crucial for enhancing country exports for earning precious foreign exchange,” he added. PRGMEA Chairman Ijaz Khokhar, PRGTTI Vice-chairman Sohail Afzal, PKTI Chairman Adil Butt, PHMA executive member Rehan Bharara, Faisalabad Garments City Company chairman along with senior officers of the Ministry and JICA attended the meeting.

Financial services company India Nivesh has warned that when the Trans Pacific Partnership (TPP) comes into effect, India would be negatively impacted to a major extent; though India would not be the only country at disadvantage. China, Pakistan, Bangladesh, Sri Lanka and other non-members of TPP would also be adversely affected. The US is in advanced stages of closing the Trans Pacific Partnership (TPP) agreement – one of the largest free trade agreements signed involving 12 countries. In a report,India Nivesh said the entire supply chain would undergo a major change as Vietnam would enjoy duty free access to one of the largest textile and apparel market i.e. the US. This would render other non-member countries at disadvantage reducing their competitiveness in the global market. The report said Indian companies can try to work around the TPP by establishing capacities in Vietnam and take benefit from TPP instead. China has already begun investing in Vietnam to benefit from TPP. This is a huge opportunity for Indian companies as they have various incentives from Indian and Vietnamese governments. To take advantage of yarn forward rule, spinning and weaving capacity would be more beneficial, as garment capacities are in abundance in Vietnam. With the nearing expiry of Technological Fund Scheme by March 2017, setting up capacities in Vietnam offers an alternative for cost effective expansion. India would be positive on companies establishing their manufacturing capacities in Vietnam especially in spinning and weaving, as they exhibit their foresightedness to take advantage of benefits of TPP. Currently, companies are evaluating the investment scenario in Vietnam. As per media reports, Aditya Birla group is considering an investment in Vietnam in the weaving and dying segment of the industry. Also, Welspun group is considering an investment in Vietnam, the report said.

The next edition of Intertextile Pavilion which kicks off from July 9, 2015 will see around 700 exhibitors from eight countries exhibiting at the Shenzhen Convention & Exhibition Center, Shenzhen, China. Following years of successful cooperation, Intertextile Pavilion Shenzhen will again run concurrently with the 15th China International Fashion Brand Fair – Shenzhen, which will increase buyers’ sourcing options. The exhibitors will showcase their selections of high-quality ladieswear, casual wear and suiting fabrics, as well as the latest knits, laces, embroidery, yarns, fibres and accessories in halls 6, 7 and 9. Besides suppliers from Hong Kong, India, Italy, Japan, Korea, China, Taiwan and UK, there will also be three country and regional pavilions to enrich the variety of products for buyers to source from. “These include the Korea Pavilion organised by the Korea Fashion Textile Association (KFTA) and Daegu Gyeongbuk Textile Industry Association (DGIA), a press release from the organiser Messe Frankfurt said. There will also be a Taiwan Pavilion organised by the Taiwan Textile Federation (TTF) and a Shengze Pavilion from the Eastern Silk Market China in Suzhou province. To meet expanding needs of the Southern China textile industry, a seminar program has been added for the first time. A total of five seminars will be held during the first two days of the fair and experts from different sectors will share the latest industry updates on fashion trends, market information, branding strategies and more. This year, the organisers have invited the Hong Kong marketing head of Italy’s Close-Up Fashion Publications, Michael Leow to present the ‘Key Womenswear Trends for Autumn/Winter 2016 – 2017’. Chairman of the Hong Kong Apparel Society Ltd, Banny Yu will share his opinion on ‘Sourcing Strategy & the Concerns of Production Bases’. In addition to the seminars, the Fabrics China Trend Forum, located in hall 9, will help visitors to understand more about next season’s domestic fashion trends. Wendy Wen, Senior general manager at Messe Frankfurt (HK) Ltd said, “We are pleased to see Intertextile Pavilion Shenzhen becoming one of the most important industry events in Southern China.” “In previous editions, we have seen increasing participation of international fashion brand buying houses, such as Brooks Brothers, Diesel, Esprit, Givenchy, G2000 and many others,” Wen observed. “Their strong support proves the quality of the exhibitors at this fair meets international standards,” she added.

The Japan International Cooperation Agency (JICA) and the Pakistani textile ministry held a meeting on July 2 in Islamabad to work out parameters for the project of “Skill Development and Market Diversification” (PSDMD) for the garment industry, the Pakistani media has reported. JICA senior advisor Takafumi Ueda and textile ministry’s secretary Amir Marwat led the two delegations. It was mutually agreed in the meeting that JICA experts would facilitate the garment sector, specially the small and medium enterprises (SMEs), in the field of international marketing practices along with compliance requirement, marketing and product diversification. The second component of the project would focus on capacity building of the two Export Development Fund (EDF) institutes, Pakistan Readymade Garment Technical Training Institute (PRGTTI) and Pakistan Knitwear Training Institute (PKTI), managed by the Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) and the Pakistan Hosiery Manufacturing Association (PHMA) respectively. The JICA experts would impart training and provide necessary machinery for the institutes. The third component relates to training institute at Faisalabad Garment City. Takafumi Ueda said, “JICA previously coordinated with the textile sector of Pakistan in 1993 by helping upgrade the National Textile University Faisalabad. The new project would open a new era of cooperation between JICA and ministry of textile industry, as JICA would provide technical assistance in different fields of textiles sector.” Amir Sarwat highlighted that Pakistan has inherent advantage of being 4th largest producer of cotton in the world with a huge potential to further increase crop yield. For success of any export led Industry, local availability of basic raw material is considered as an added advantage. He praised JICA for providing technical support to the textile industry. He said that this project would facilitate in achieving goals and objectives set forth in the Textiles Policy 2014-19. “The project would be beneficial in imparting higher skills in the area of garments along with market and product diversification of textile sector which are crucial for enhancing country exports for earning precious foreign exchange,” he added.

Garment workers on Friday demanded that wages and festival bonus be paid to them by July 8 so that they can celebrate Eid-ul-Fitr smoothly. They made the demand in separate rallies held under the banners of different organisations in front of National Press Club.  On Thursday, State Minister for Labour Mujibul Haque Chunnu asked the garment factory owners to clear wages and festival bonus of their workers by July 10 and 14 respectively. He issued the instruction after a meeting of the crisis management committee for RMG sector held at the ministry.

Two competing fractions from BGMEA, “Forum” and “Shommilito Porishod” has recently came to an understanding not to compete each other in the election. BGMEA election is scheduled on September 8, 2015. A joint committee from Forum and Porishod will select candidates for the election. On the committee, Mr. Tipu Munshi is the convener and Mr. Anwar-Ul-Alam Chowdhury is the member secretary.  This committee will select candidates for the next two terms. For the first term, they will select President candidate from Porishod and for the second, they will select from Forum. After that term, the two fractions will unite. However, any interested person can participate in the election. According to people related to BGMEA, the possibility of someone elected without a nomination from Forum or Porishod is fairly low. Hence, this initiative is viewed as taking the voting rights off from ordinary members. On a fairly contested election, the candidates tell their views and action plans on problems and development issues. The members can select the best possible candidate who can address their requirements. If there is no alternative, how can they choose? There are many shortcomings of the democratic process. However, until now, this is the best process we have to elect our leadership. Absence of this process undoubtedly makes the leadership unaccountable leading the organization to inefficient and corrupt. The leadership can become questionable any time. Will the leadership be able to successfully negotiate with government, buyers, accord and alliance, and many other concerns? Will they be able to reflect the dreams of the members? Or will they be able to get the same importance hold by present members? Only time will tell. Ex President and Forum leader Mr. Anwar-Ul-Alam told the media that the professionalism of BGMEA office bearers are decreasing. The last few committees failed to meet the expectations placed on them. To enhance the professionalism and build BGMEA into a corporate model, they are taking this initiative. But this statement in a way certifies that Forum and Porishod are not doing what they are expected to do. They are not nominating professional candidates. After all, the general members are only electing office bearers from their nominees. If they (Forum and Porishod) cannot nominate professional candidates now, how can we expect them to do the same in future? However, Ex BGMEA Presidents Mr. Shofiul Islam (Mohiudding) and Mr. Abdus Salam Murshedi have disagreed this comment and told, if the last few committees failed to meet the expectation, how can Porishod win the last three consecutive elections? BGMEA can only get out of this if both Forum and Porishod assures the professionalism of their nominees and contest on the election.

Law enforcing agencies are greatly concerned over possible labour unrest over the timely payment of salaries and festival allowances in the apparel industry in the port city ahead of Eid-ul-Fitr. Meanwhile on Thursday, several hundred apparel workers of Glory Industries Ltd in Bayezid area of the city took to the streets and put barricades on the roads bringing the traffic to a halt for two hours.  The workers of the apparel factory belonging to Sunman Group took to the streets protesting the delay in paying off the arrear salaries.   However, the labour leaders observed that any agitation by the workers could easily be averted if the factory owners pay off all outstanding wages and festival allowances before the biggest festival of the Muslim community.      The trade union leaders in apparel sector of Chittagong urged the factory owners to pay off all the outstanding salaries and festival allowances well ahead of Eid to avert any untoward incident.   At a meeting with leaders of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) on June 21, Abdul Jalil Mondal, commissioner of Chittagong Metropolitan Police, requested the factory owners to clear all arrears and allowances by July 15.  The factory owners will not be able to avoid responsibility if any labour unrest erupts because of unpaid salaries and allowances, he added. Contacted, Abdul Jalil Mondal told The Independent that it was very inhuman not to pay off the outstanding wages and festival allowances. “I will urge the apparel factory owners to comply with the decision taken at the June 21 meeting. Every apparel factory owner will have to clear all the outstanding wages and allowances by July 15,” said the CMP chief.    Meanwhile, industrial police in the port city have already prepared a list of 70 sick apparel factories which may trigger labour unrest. Tofayel Ahmed Mia, director of industrial police, Chittagong, said that they prepared the list of sick factories based on a number grounds. “The factories having no membership of BGMEA, running on sub-contract basis, having previous records of not paying off wages on time and having no work order have been included in the list,” added Tofayel.   “We are on high alert. We are also going to hold meetings with the owners of the sick factories to ward off untoward incidents like labour unrest, agitation and vandalism,” said Tofayel.  Abdur Razzaque, president of the Chittagong chapter of Bangladesh OSK Garment and Textile Workers Federation, said that the factory owners must comply with the government directive to pay off salary of June by July 10 and festival allowance by July 14.    “You can hardly rule out the possibility of untoward incident ahead of Eid if the outstanding wages and festival bonuses are not paid off on time,” added the labour leader. Echoing the same demand, Tapan Dutta, president of the Chittagong unit of Bangladesh Trade Union Centre, said that the RMG factory owners must comply with the government directive to clear all outstanding dues by July 14. Mohammad Mamun, general secretary of Bangladesh Trade Union Sangha, Chittagong, claimed that only 30 percent RMG factories were abiding by the minimum wage structure set by the wage board of the country. “The apparel factory owners usually sack the workers on a fragile ground so that they don’t have to clear the payments ahead of Eid,” added Mamun.  According to the BGMEA, 750 factory owners of Chittagong are members of the organisation.  However, out of the total figure, only 400 apparel factories are running factory productions employing around 5 lakh people. While talking to the BGMEA, MA Wahab, director of the BGMEA, said that they directed every member of the organisation to pay off the outstanding wages and allowances on time so that no untoward incident could take place.

Workers of ready-made garment (RMG) factories and other industrial units will get their wages for the month of June by July 10 and the festival allowance by July 14. State minister for labour and employment Md Mujibul Haque made the announcement on Thursday.  “The workers of RMG and other industrial units will get their wages for June by July 10, 2015 and Eid-ul- Fitr festival allowance by July 14, 2015,” he told journalists after the 28th core committee meeting on crisis management in the RMG and other industrial sectors at the conference room of the labour ministry. Labour secretary Mikail Shiper, inspector general of the Department of Inspection for Factories and Establishments Syed Ahmed, leaders of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Bangladesh Employers Federation and officials of different government organisations, among others, attended the meeting.  “I think they (BGMEA and BKMEA) would not disappoint the government. We hope they will pay wages and Eid-ul- Fitr allowance by the deadline to their employees,” he said while responding to a query about the surety of the commitment as pledged by the factory owners. About Eid-ul Fitr holiday for the workers, the minister said: “We have discussed the matter with the BGMEA and BKMEA leaders. We requested them not to grant all their workers holiday at the same time-just one/ two days ahead of or behind the schedule of BGMEA or BKMEA) to ensure the workers’ hassle-free and smooth journey home.”  Mr Haque claimed that the country’s industrial units were now calm and quite compared with the previous times.