The readymade garments industry is still fundamental to the prospects of the Bangladesh economy, said a UNTACD report. “The RMG industry has been the major driver of the country’s economic development in recent decades and is still fundamental to the prospects of the Bangladesh economy,” said the World Investment Report 2014, which has been published yesterday globally.  The industry is considered the “next stop” for developed-country TNCs that are moving sourcing away from China. Such opportunity is essential for development as Bangladesh needs to create jobs for its growing labour force, the report said. With the prediction of further growth in the industry and the willingness of developed-country firms to source from Bangladesh, the picture on the demand side seems promising, it added. According to the report, the sector needs to address constraints on the supply side – its poor infrastructure continues to deter investment in general and FDI in particular. While at the firm level, one issue concerns the need for better compliance with labour legislation as illustrated by several tragedies in the country’s garment industry. Besides strengthening such compliance, the industry needs to develop its capabilities, not only by consolidating strengths in basic garment production but also by diversifying into higher-value activities along the RMG value chain, the report mentioned. Currently, Bangladesh’s garment firms compete predominantly on price and capacity. The lack of sufficient skills remains a major constraint, and both domestic and foreign-invested firms needed to boost their efforts in this regard, it added. A recent UNCTAD study shows the dominance of basic and on-the-job training, which links directly to established career trajectories within firms. However, high labour turnover hampers skill development at the firm level.

The Chinese subsidiary of Hong Kong based Li & Fung signed a strategic partnership with two of China’s largest retail groups, Shanghai Bailian Group and Beijing Wangfujing Department Store. A Li & Fung press release informed that the strategic partnership has been done through setting up a joint venture (JV) in the Shanghai Free Trade Zone. Li & Fung holds 20 per cent stake in the JV, with the Bailian Group and Wangfujing Department Store holding 40 per cent each. Under the terms of the partnership, Li & Fung will provide expertise to design, source and produce private labels and licensed brands tailored to the requirements of Bailian Group and Wangfujing. According to Li & Fung, the JV combines the strengths and capabilities of two of China’s largest retailers, Bailian Group and Wangfujing Department Store and global supply chain manager, Li & Fung. Chinese multi-brand retailers are looking to develop private and proprietary brands so as to differentiate themselves from competitors, increase margins and improve customer loyalty. The key business of the JV includes facilitating the development and management of private labels and licensed brands. In the first three-year plan, the JV will focus on the development of product categories including menswear, womenswear, children’s wear and home products. It will develop between one and three private labels and up to six licensed brands over this three year period, and may involve the opening of up to 300 stores or store-in-stores and realise up to 1 billion Yuan in sales. In the long run, the JV aims to be at the forefront of a new breed of brand development and management companies giving strong own-brand capabilities to traditional retailers. “We are excited to join forces with two of China’s largest retail companies to bring forth the transformation of China’s retail industry,” said William Fung, group chairman of Li & Fung. He added, “Through this strategic partnership, Li & Fung is able to extend the global supply chain into a substantial retail network that serves a large growing middle class in China.” Through the introduction of private brands and exclusive brands, the JV will enable its partners to effectively increase their competitiveness by offering a different and cost effective product offering. The JV also aims to introduce globally sourced products that offer Chinese consumers a wider variety of foreign goods. Li & Fung specialises in responsibly managing supply chains of high-volume, time-sensitive goods for leading retailers and brands worldwide from more than 300 offices across 40 economies.

US apparel retailer Kate Spade & Company has named Emilia Fabricant as president of the North America region effective June 29, 2015. “In this role, Fabricant will oversee the Company’s North America business, with responsibilities across all distribution channels, and will report to CEO Craig Leavitt,” Kate Spade said in a press release. Craig Leavitt said, “Emilia’s combination of experience with luxury retailers, mall-based retailers and online businesses makes her an excellent fit for our team.” “She will bring valuable leadership and perspective as we continue to focus on our channel-agnostic approach and on fulfilling our lifestyle vision to drive profitability,” Leavitt added. “As our business continues to expand, Emilia will play a central role in overseeing all aspects of our distribution channels in North America,” he observed. Most recently, Emilia Fabricant served as executive vice president of Aeropostale, Inc. overseeing design and merchandising across all divisions, and serving as president of GoJane.com. Prior to that, she served as president of Bebe Stores, Inc., as well as president and chief merchandising officer of Charlotte Russe, Inc. Fabricant also founded Cadeau Maternity, and served as president and chief merchandising officer of eStyle, Inc. following its acquisition of Cadeau. She began her merchandising career with Barneys New York, where she served in a number of management roles, culminating with senior vice president, Women’s Co Op and Outlet Division. Fabricant said, “Over the past several years, I have watched Kate Spade build incredible momentum in North America and grow consumer appeal and demand across product categories.” “I am eager to apply my experience in brand management and merchandising to Kate Spade & Company and look forward to working with its talented, innovative team,” she too added.  Kate Spade & Company designs and markets accessories and apparel principally under two global, multichannel lifestyle brands; kate spade new york and Jack Spade.The Company also owns the Adelington Design Group, a private brand jewelry design and development group that markets brands through department stores. The Company also has a license for the Liz Claiborne New York brand, available at QVC, and Lizwear, which is distributed through the club store channel.

Vietnam has emerged as the fourth largest textile exporter in the world by earning US$12.18 billion in the first six months of 2015, said the Vietnam National Textile and Garment Group (Vinatex). The earning is 10.3 per cent higher than last year. US, South Korea and the European Union were the biggest buyers of Vietnamese products, posting growth of 11.0 per cent, 8.3 per cent and 8.2 per cent respectively, against the same period last year. According to Le Tien Truong, General Director, Vinatex the results are a positive sign which will enable country’s garment industry to achieve the target. The textile and garment sector is aiming at total exports of US$28.0-28.5 billion in 2015. In 2014, the industry witnessed good growth in exports reaching US$24.5 billion, up nearly 16 per cent compared to 2013. The sector is expected to benefit from several free trade agreements (FTAs) that are likely to take effect. Owing to advantages accruing from the FTAs, the textile industry could double the size of production in ten years. On opportunities brought by the Vietnam-EAEU FTA, Vietnam is likely to earn over US$1 billion from shipping textiles to the market if it takes full advantage of benefits from the agreement. Vietnam is in the final stages of negotiations for FTA with South Korea, and the Customs Union of Belarus, Kazakhstan and Russia. With favourable movements in the global economy and the recent signing of free trade agreements (FTA) between Vietnam and the Eurasian Economic Union (EAEU), and South Korea, 2015 is forecast to be a bright year for Vietnam’s garment industry. The sector will need to make additional efforts to seek new markets and opportunities, and establish partnerships with major groups to be able to sign high-value orders in the remaining month of this year, Le added.

The government-appointed engineers completed inspection of 1,000 garment factories under the national initiatives, the International Labour Organisation said in a statement yesterday. The government has been inspecting fire, electrical and structural flaws of the factories, which are not the members of the Accord and Alliance. Apart from the government inspection, two other agencies — Accord, a platform of 200 retailers and brands, mostly European, and Alliance, a platform of 26 North American retailers and brands — have been inspecting factories for ensuring workplace safety after the Rana Plaza building collapse. The government, Accord and Alliance targeted to inspect a total of 3,508 export-oriented garment factories throughout Bangladesh. According to the ILO, some 2,904 factories have been inspected so far. Of the factories, 1,000 fall under the government’s National Initiative under the Tripartite Plan of Action, supported by the ILO with backing from Canada, the Netherlands and the United Kingdom. Accord and Alliance have inspected 1,904 factories, and some 604 factories from the original list remain to be inspected, the statement said. On the completion of the inspection of 1,000 factories, Syed Ahmed, inspector general of the Department of Inspection of Factories and Establishments (DIFE), said, “This is a significant milestone as we seek to create a safer RMG sector in Bangladesh.” “We are now making concerted efforts to complete as many inspections as possible by the July 31 deadline. We shall not compromise on the safety of the workers. After this date, factories will no longer receive inspections for free and will need to meet the costs themselves if they wish to continue exporting,” Ahmed said.

Bangladesh Garment Manufacturers and Exporters Association on Tuesday demanded inclusion of its representative in the steering committee of the Accord, the platform of European buyers and retailers, to reduce the gap between the BGMEA and Accord that became visible in recent time regarding safety operation.In a meeting with the Accord, the BGMEA president Md Atiqul Islam said that there are some misunderstandings between the two parties on various aspects as there is no direct representation of the BGMEA in the Accord.Following the Rana Plaza collapse on April 24, 2013 that killed more than 1,100 people, mostly garment workers, the EU brands and retailers formed Accord on Fire and Building Safety in Bangladesh with a commitment of upgrading member factories to meet international fire and safety standards.Accord has inspected about 1,300 factories from which its members source their products and is working to implement corrective action plan.‘The Accord should include the BGMEA representative in its steering committee to reduce the gap between the factory owners and the retailers’ platform. Nowadays the misunderstanding is increasing as factory owners have no scope to discuss their concerns with the Accord directly,’ the BGMEA president told reporters after the meeting.According to Atiq, the Accord officials agreed with the BGMEA that inclusion of factory owners’ representation can reduce misunderstanding between factory owners and Accord.In the meeting, Accord officials urged the BGMEA leaders not to make any negative comment on the initiative which can put a negative impact on their image as well as safety operation.Responding the request, BGMEA said that Accord should not make public the faults of the factories through the international media without consulting with the BGMEA, the meeting source said.In the meeting, the BGMEA discussed that to some extent the Accord’s job is beyond the law of the land as factory owners received threat from the Accord to declare their units non-compliant for not reinstating workers who have been terminated as per the law.Factory owners alleged that the Field Resource People engaged by the Accord are agitating workers and damaging labour-management relations instead to raise awareness among the workers.They discussed that the government set review panel was the authority to take decision in factory closure after inspection, but Accord advised brands to stop production and to pull out orders before the decision from the review committee.The Accord assured BGMEA that the platform would conduct its safety operation in the readymade garment sector complying with the laws of the land, the BGMEA leaders said.On the remediation issue, the BGMEA said that factories remained under pressure from the buyers group to replace the fire doors and other safety equipments that had been installed as per the requirements of buyers before the launching of Accord.Financial capacity is most important for a factory to take actions for Detailed Engendering Assessment and Corrective Action Plan, but financial assistance is not forthcoming from the buyers as expected.The BGMEA demanded that considering the remediation costs, buyers should increase the price of products.It also demanded to continue procurement from the shared building factories that were foundsafe for operation and carrying out remediation works.The former presidents of the BGMEA Abdus Salam Murshedy, Shafiul Islam, vice president Shahidullah Azim, Accord executive director Rob Wayss, and chief safety inspector Brad Loewen and Regional Head (Bangladesh & Pakistan) of H&M Roger Hubert attended the meeting.

The absence of apparel makers’ representation in the Accord’s decision making process has widened communication gap between the two parties, industry leaders said.Both BGMEA and Accord’s steering committee have realised that confusion and misunderstanding have surfaced as there is no direct communication between us,” Abdus Salam Murshedy former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) told the FE after a committee meeting.The meeting was held Tuesday between the leaders of the BGMEA and visiting members of the Steering Committee of Accord at the trade group’s headquarters in the city.BGMEA’s vice presidents Shahidullah Azim and Reaz -bin-Mahmood, its former president Shafiul Islam Mohiuddin and former vice president Siddiqur Rahman, Philip Chamberlain of C & A, Roger Hubert of H&M, Monika Kemperle of IndustriAll, Jenny Holdcroft from UNI Global Union, Scott Nova of Worker Rights Consortium, Accord’s Executive Director and Chief Safety Officer Rob Wayss and Brad Loewen, among others were present in the meeting.”If we were in the decision making panel, it would be easier to sort out the problems surfaced following the post inspection activities,” BGMEA President Md Atiqul Islam said.Giving example of field resource people, engaged by the platform to raise safety awareness among factory workers, he said they are outsiders and often allegedly incite agitation among workers, damaging labour-management relations.”This is not consistent with law of the land which provides for establishment of safety committee with representatives from factory workforce to raise awareness and enable workers to report safety concerns,” he added.Accord on Fire and Building Safety in Bangladesh-a coalition comprising with about 200 apparel buyers and retailers and international trade unions-was formed after Rana Plaza building collapse to build a safe and healthy readymade garment industry in the country.The Advisory Committee of the Accord holds meeting with the BGMEA leaders time to time, but the latter did not have any representation in Steering Committee that comprised with members from apparel buyers, retailers and trade unions with an independent chair from the ILO.Quoting members of the Accord’s Steering Committee, the BGMEA president, however, said that they have assured all of complying with law of the land.Earlier, the BGMEA leaders had sought detailed information from the Accord’s Steering Committee about its spending on factory remediation programme.The meeting also raised some other issues including lack of sufficient number of experts to provide service to factories for conducting detailed engineering analysis, retrofits, fire designs, financial support, especially for small and medium-sized units, assurance of continuation and increase business and not to withdraw orders from factories located in shared buildings.Replying to a question, Ms Monica said they had discussed the ‘differences’ without going details on those.”…we have to take the next step and try to go forward,” she said adding they would look into the discussed issues in the next meetings

Unhappy over non-payment of wages and festival bonus ahead of Eid, readymade garment (RMG) workers may burst into violence in Dhaka and Narayanganj, intelligence agencies fear. Industrial police have identified 410 factories across the country as vulnerable to violence ahead of the Muslims’ largest festival. Meanwhile, the home ministry has sent letters to BGMEA and BKMEA-two trade bodies of woven and knitwear segments of the RMG sector-asking for paying wage and bonus to workers in time. Garment factory owners have also been asked to take necessary measures to help stem any possible unrest. However, industrial police, as per instruction from the ministry, have stepped up patrol and vigilance in the country’s 4,500 plus factories across the country, “We’ve intensified security measures in the risky units to avert any further trouble during the fasting month. Our intelligence officials have identified 407 garment factories as risky and vulnerable to violence,” an intelligence official told the Daily Observer. At least 90 RMG trade union leaders are under strict intelligence surveillance, the official further said. Unrest in the RMG sector takes place almost every year just before Eid over the payment of workers’ arrears and bonuses. The workers take to the streets to press home their demands, causing long tailbacks on highways. Of the 407 RMG units, 136 factories have been branded as risky and vulnerable at Ashulia-Savar-Dhamrai industrial hub, home to most of the country’s biggest apparel manufacturers. At least 142 factories have been found vulnerable in Chittagong belt, 102 units in Gazipur-Tongi areas and the rest and Kanchpur region, senior police officers said, quoting from their findings. They pointed to the fact that said nearly 45 per cent of the risky factories are not registered with BGMEA and BKMEA where the security force keep their eyes open round the clock to prevent any more chaos. “Garment factory owners have assured us that they would pay the workers their salaries and bonuses,” a home ministry official said. “We hope the problems will be solved,” said BKMEA Vice-President GM Faruk. He also said RMG accounts for nearly 76 per cent of the total export earnings. On the recurrent labour unrest during the festival, the BKMEA leader said an international plot is going on to ruin the sector. “If the government does not take immediate steps to identify these perpetrators for foiling such conspiracy, the sector would fall in deep crisis,” he said. Sources claimed that uncertainty looms over the payment of salaries and bonuses in some factories of the 1,200 factories that are not members of BGMEA. Of the total 5,300 factories listed with BGMEA, 4,300 are now operative.

Apparel exporters will demand that Accord, a platform of retailers and brands of European Union, should not conduct any operation in the readymade garment sector of Bangladesh beyond the purview of the laws of land. They will make the demand at a meeting between the steering committee of the Accord on Fire and Building Safety in Bangladesh and the Bangladesh Garment Manufacturers and Exporters Association to be held today at the BGMEA office in the capital. In the meeting, the BGMEA will place two more demands concerning clear declaration from Accord about remediation financing and assurance of viability of investment in remediation. Concerns of both the parties over the ongoing safety initiative will be discussed in the meeting as the recent comments made by finance minister AMA Muhith and BGMEA president Md Atiqul Islam put negative impact on the retailers’ mood. On June 15, at a meeting with the leaders of the BGMEA, Bangladesh Knitwear Manufacturers and Exporters Association and Bangladesh Textile Mills Association, Muhith described Alliance, a platform of North American retailers and brands, and Accord as a ‘noose for the garment industry’. In the meeting, the BGMEA president described Accord as a ‘big problem’ for the Bangladesh’s readymade apparel industry. Following the comments, two global trade unions — IndustriAll Global Union and UNI Global Union — strongly condemned the comments and termed the remarks as ‘inaccurate and irresponsible’. The signatories of Accord suggested that the BGMEA should discuss all the concerns about the operations of Accord in the meeting with the Accord steering committee rather than airing them first in the media. To face Accord in the today’s meeting, the BGMEA took tough preparations through discussion with the former presidents of the trade body. The incumbent leaders of the BGMEA and a former president of the trade body on Monday found out some activities of Accord, which, they think, were conducted beyond the purview of laws, to discuss in the meeting. A BGMEA source said that the garment sector leaders would oppose the Accord’s interventions regarding trade union in the factories and benefits of closed factory workers. They will also renew their reservations over the Accord provision of instalment of auto sprinkler in the factories as the provision is not mandatory in the laws of land. ‘In the meeting, we will raise three issues including clearer indication about remediation financing, conducting safety operation under laws of land and assurance of viability of our investment to be done for the remediation work,’ BGMEA vice-president Shahidullah Azim told New Age on Monday. Buyers have to ensure their stance over further work orders and continuation of business relation, as factory owners will have to invest a huge amount of money to implement the corrective action plans provided by Accord, he said. Azim said that despite repeated assurance the retailers’ platform was yet to provide any fund for remediation. The BGMEA has been alleging for the last couple of months that Accord and its executive director Rob Wayss were doing activities beyond the purview of the laws of land. The trade body also several times described the platform as a big problem for the RMG sector. IndustriAll Global Union and UNI Global Union recently claimed that Rob faced egregious conduct by a factory which disciplined union activists for reporting unsafe conditions. The global unions hoped that the BGMEA would call on the factory to correct its behaviour. Following the Rana Plaza collapse on April 24, 2013 that killed more than 1,100 people mostly garment workers, the EU brands and retailers formed Accord with a commitment of upgrading member factories to meet international fire and safety standards. Accord has inspected about 1,600 factories from which its members source and is working to implement corrective action plan.

The government has undertaken a plan for running and modernisation of eight closed textile mills under the Bangladesh Textile Mills Corporation (BTMC) on joint venture with local and foreign entrepreneurs. Textiles and Jute Minister Muhammad Imazuddin Pramanik informed this in the House yesterday while replying to a scripted query raised by treasury bench member Md Tazul Islam (Comilla-9). The textile mills are: Ahmed Bawani Textile Mills, Demra, Dhaka, Dinajpur Textiles Mills, Sadarpur, Dinajpur, Dost Textiles Mills, Ranirhat, Feni, Tangail Textile Mills, Tangail, Darwani Textile Mills, Nilphamari, RR Textile Mills, Sitakundu, Chittagong, Quaderia Textile Mills, Tongi, Gazipur and Chittaranjan Cotton Mills, Godnail, Narayanganj. Imazuddin Pramanik also said that six BTMC-run mills are now operational on the basis of service charge, while steps are being taken to operate the remaining mills under the same system. He said the government is going to frame the Textile Industry Law, 2015 for smooth management of all activities related to the textile industry side by side with taking various measures for modernization of the textile industry. He also said that projects have been undertaken to establish textile vocational institutes, diploma institutes and BSC textile engineering colleges to create skilled manpower in the textile industry.