Following the modifications of Plan of Action for realisation of the Partnership for Sustainable Textiles, major organisations and numerous well-known companies from the textile industry have joined the Textiles Partnership last week. There are currently over 100 members. “The Oeko-Tex Association welcomes the latest development in the Textiles Partnership and specifically the positive response from industry and trade,” explained Georg Dieners, Secretary General. The Textiles Partnership aims to bring about social, ecological and economic improvements all along the textile supply chain. “We share the central objectives of the Partnership and support its members in their efforts to achieve continual improvements to existing processes and working conditions in textile production around the world. To continue to enable support for this multi-stakeholder approach in the future, the International Oeko-Tex Association joined the Textiles Partnership through the Oeko-Tex Foundation.” Reliable partners “The specific focus of the range of Oeko-Tex certifications and services on the needs of the industry also means we have been one of the most reliable partners for companies from the global textile and clothing industry for over 20 years,” commented Dieners. “And we are still happy to share our many years of market experience by acting as an intermediary between industry, trade, NGOs and politicians at the round table of the German Federal Government.” Textiles Partnership In October last year, representatives of the German Federal Government and 30 representatives from the textile and apparel industry, trade unions, non-governmental organizations and industry associations jointly launched the Partnership for Sustainable Textiles. Two experts from the Oeko-Tex Association were also amongst the 150 participants at the launch event in Berlin. The Textiles Partnership aims to pool the strength and expertise of its members in order to bring about social, ecological and economic improvements all along the textile supply chain. In order to achieve this, the Textiles Partnership aims to tackle common challenges more effectively, exploit synergies through joint projects on the ground, and improve underlying conditions in the producer countries. Certifications and services The independent Oeko-Tex certifications and services offer the members of the Textiles Partnership a comprehensive system that they can use to best implement the objectives defined in the action plan in practice and communicate them in a credible manner. Oeko-Tex Standard 100 and STeP by Oeko-Tex thus enable the independent, globally standardised verification of human-ecological product safety as well as environmentally friendly production technologies and socially responsible working conditions. The three-stage assessment system of STeP certification means that companies can also document their sustainable commitment in the B2B area in a transparent way. In addition, the new Made in Green by Oeko-Tex label enables brands, retailers and manufacturers to communicate their commitment to sustainability to consumers using the end product itself. The product ID on the Made in Green label also gives end consumers the opportunity to clearly track the manufacturing path

Businesses have demanded retaining 0.3 percent tax at source on export of readymade clothing.They have called for withdrawal of the one percent tax proposed in the budget for the 2015-16 FY.Leaders of the associations representing apparel exporters made the demand at a meeting with Finance Minister Abul Maal Abdul Muhith at his Secretariat office on Monday.Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Atiqul Islam placed the demands of the exporters in a written statement.The demands also include withdrawal of one percent duty on capital machinery import, extension of the tax rebate for apparel sector by five more years, waiver of outstanding VAT on service sector and suspension of bonded warehouse audit.Islam thanked the government for continuation of different facilities and incentives for the garment sector in 2015-16 FY.He claimed murders of people and arson of vehicles during the BNP-led alliance’s agitations had caused apprehension among overseas buyers of Bangladeshi garments.”Now buyers don’t want to come to Bangladesh. That’s why export target for the current FY cannot be attained,” he said. The BGMEA chief said Bangladesh exported clothes worth $22.9 billion this FY until Monday against the target of $27 billion for the entire year.Export figure will reach $25 billion. Even goods worth $2.1 billion will be exported during rest of this month,” he added.Islam said Bangladeshi apparels were losing competitive edge as taka had been strong against the US dollars.”In such a situation 1 percent tax at source on total export value will lower competitiveness of the garment industry. That’s why we’re requesting maintaining tax at source at 0.3 percent like the current fiscal year,” he added.

Finance Minister AMA Muhith has termed the recent activities of the Accord and Alliance as ‘nooses’ in the growth of the country’s RMG sector.  The minister made this remark while talking to the reporters yesterday after a meeting with the leaders of different associations of the country’s readymade garment sector. BGMEA President Atiqul Islam and BKMEA President AKM Selim Osman were present during the briefing. Muhith accused the Accord and Alliance of hatching a conspiracy to suppress growth of the RMG sector while the condition of the country’s RMG sector has been improved.  Accord and Alliance are the two global retailers’ platforms by the European Union (EU) and North American countries working in Bangladesh to establish labour rights and promote work place safety in the readymade garment sector. Terming the directives of the Accord and Alliance ‘unfortunate’ the minister alleged that this kind of activities are hindering the activities of the garment factories.  In this regard, BGMEA President said, “The way the staffs of the Accord and Alliance have stringently inspected the garment factories in the country is nothing but a rare stance in the world.”   As the garment factory owners will have to fulfill conditions set by the Accord and Alliance,  the overall expenditures of a factory owner are to increase by Tk5 to Tk20 crore, he added. “Accord and Alliance have put negative comments on their websites on the exportable items of those garment factories that are unable to comply with their conditions.”  In this connection, the minister said, “We’re aware of the negative activities of the Accord and Alliance on country’s garment sector.” “We will discuss about the matter with Commerce Minister Tofail Ahmed and even with Prime Minister Shiekh Hasina,” warned the minister. Muhith also said, “If it is necessary, we will also raise the issue with the European countries and North American countries USA and Canada” Regarding the increase of tax at source on earning from exportable items from 0.35 to 1%, the minister again said, “We will soon sit with with Prime Minister Sheikh Hasina to settle the matter”. Leader of the RGM sector have also raised a five-point demand including withdrawal of 1%  duty on import of capital machinery and 10% income tax on the owners of garment factories.  But, Muhith urged the garment factories owners to immediately relocate their garment factories Dhaka to Baushia of Munshiganj district.

Finance minister AMA Muhith on Monday said the Accord and Alliance, two platforms of global brands, probably want to suppress Bangladesh’s RMG sector when the industry has advanced a lot. “The Accord and Alliance had been welcomed to earn the trust of the buyers of the USA and EU countries but today their activities have turned into a slipknot,” he said. Muhith came up with the remarks while addressing a post-budget discussion with the three leading trade bodies of the apparel sector—BGMEA, BKMEA and BTMA—at the finance ministry at the Secretariat. The finance minister said that the Accord and Alliance probably want to suppress the RMG sector of Bangladesh when this industry has advanced a lot in export earning. BGMEA president Atiqul Islam, BKMEA president, AKM Selim Osman MP, BTMA president Tapan Chowdhury and other senior leaders of the organizations were present. The Accord is the representative organisation of the buyers of European Union and Alliance is of the buyers of the North America. The organizations have been working in Bangladesh from after Rana Plaza tragedy regarding the workers safety and fire safety. BGMEA President Atiqul Islam said the way the Accord and Alliance are inspecting the factories is simply unprecedented and there have no such record in any other country. “They are compelling all the factory owners to fulfill their conditions. This is why the expenditure of every factory has increased from Tk 5 crore to 20 crore.  As a result, production cost of the RMG goods continue to increase and they are suggesting the buyers not to buy products from those who are failing to fulfill the conditions,” Atiqul added. The three trade bodies of the apparel sector submitted a five-point demand to the finance minister including  keeping the rate of tax at source unchanged and withdrawal of the proposed 1 percent tax on import of capital machinery.   On their demands, the finance minister said that the government has a soft corner for the RMG sector for keeping contribution in the employment generation. He said all the proposals will be considered actively and decision will be taken in this regard.The minister also called upon the owners to take steps to relocate their factories to the Garment Village at Baushia in Munshiganj district as soon as possible.

Information Minister Hasanul Haq Inu, MP, on Monday threw an open challenge to the chairperson of Bangladesh Nationalist Party (BNP)Begum Khaleda Zia to prove within 24 hours how the country’s interest had been compromised by the agreements signed with India, reports BSS. The minister was responding to a remark on Sunday made by the BNP leader. She said “The country’s interest has been undermined by agreements with India.” Speaking as the chief guest at the annual general meeting of the Sub-editors’ Council at the National Press Club auditorium the information minister said “All agreements and memoranda of understanding that were signed during the visit of Narendra Modi were done publicly.” Referring to Khaleda Zia’s two terms as prime minister of the country, he said “She should have known better but she prefers to lie. It is her habit to lie against the country and state and create a confrontational situation.” Referring to all the agreements the information minister said that through the 22 agreements and MOUs signed, the country’s economy would become more dynamic, incomes would rise, borders will be better protected, crimes and criminals will be dealt with more effectively and education and culture would flourish. “The sovereignty of Bangladesh is not so fragile that it could be scuttled away in a covered van or bus”, he quipped. Appreciating the critical role of sub-editors play, the information minister called them the “eyes and ears” of the media. “They have the immense responsibility of deciding what goes to print and which does not,” he said. Chaired by the president of the Sub-editors’ Council, Ashraful Islam, the meeting was addressed, among others by Md Sirajul Islam Mollah, MP, Altaf Mahmud, president, DUJ and Abdul Jalil Bhuiyan, secretary general, BFUJ. Later in the evening, at a certificate distribution ceremony at the Bangladesh Press Council the information minister said that through objective and ethical practices journalists must expose the lies and provocation in politics.

The government is worried with retailer groups from both sides of the Atlantic as their activities for improving safety and labour rights through some agreements became a ‘noose around the neck’ of the country’s burgeoning readymade garment sector. This was stated by finance minister AMA Muhith after associations like BGMEA, BKMEA and BTMA alleged during a meeting with him at the secretariat on Monday that manufacturing cost was going up because of implementation of the conditions under the agreements. The government has allowed Accord Group, created by retailers from the European Union, and the Alliance of North American buyers to evaluate compliance issues in Bangladesh’s readymade garment industry subsequently after collapse of Rana Plaza that killed more than 1,300 workers in 2013. Muhith observed that the activities by the Accord and the Alliance were ‘polite ways’ to dampen the advancement of the country’s RMG sector. ‘It is unfortunate’, he said. BGMEA president Atiqul Islam who was among the associations leaders attending the meeting said cost of running a factory was going up to Tk 5 crore to Tk 10 crore due to stiff conditions attached by the Accord and the Alliance. On Sunday, Tofail Ahmed said Bangladesh had addressed all the conditions that had been raised by the international community following the Rana Plaza building collapse but the retailers groups were creating obstacles in the factories in the name of social audit. After a meeting with visiting Dutch foreign trade and development cooperation minister Lilianne Ploumen on Sunday, Tofail told reporters that the Accord, the platform of European brands and retailers, was engaged in some activities which were beyond its jurisdiction. Lilianne Ploumen has identified fair prices of the products, unauthorised sub-contracting and rights of workers as the main challenges for the country’s RMG sector. She urged the government to allow workers to get actively engaged in trade unions. Muhith assured the association leaders of holding meetings with the prime minister, the commerce minister and the industries minister to address the growing concerns about hurting the country’s leading export earning sector. The finance minister also assured the RMG industry leaders of considering their demands like keeping export tax at 0.30 per cent, retention of zero per cent duty for import of capital machineries and extension of 10 per cent rebate on the income tax for RMG factories for another five years. Export tax has been proposed at one per cent in the recently announced budget. The businessmen said the RMG exports would be affected because of the new budgetary proposals after its growth slowed down in the outgoing fiscal. The country’s export earnings in 11 months of the outgoing financial year grew only by 2.80 per cent to US$ 28.14 billion from US$ 27.37 billion in the same period of FY 2013-14. The target for July-May period fell 6.01 per cent short due to a sluggish growth in the export of readymade garment products to the established markets. Political unrest and deprecation of the Euro against the US dollar have been blamed for the slow down of the export growth by the RMG industry leaders.

Bangladesh needs to go beyond the ready-made garments (RMG) sector in order to accelerate its overall export growth.   Some sectors to help boost export in near future include shipbuilding, jute, bicycle, pharmaceuticals and information technology (IT). These are stated in the draft report of the Diagnostic Trade Integration Study (DTIS) of Bangladesh. The World Bank (WB) has conducted the comprehensive study to identify the country’s constraints on trade regime. The DTIS draft report, in three parts, has already been submitted to the government, and on the basis of comments and suggestions a revision is now going on for its finalisation. The study also set four pillars for actions to accelerate the country’s export as well as overall foreign trade. The first pillar — ‘breaking into new markets’ — stressed better exploration of regional trading opportunities and better trade logistics for reducing delivery lags and becoming more competitive in nearby markets, especially in Asia. The second pillar — ‘breaking into new products’ — suggested more neutral and rational trade policy, taxation, bonded warehouse schemes and concerted efforts to attract more foreign direct investment (FDI). ‘Improving worker and consumer welfare’ is the third pillar, which focused on improving skills and literacy, implementing labour and work safety guidelines, and making safety nets more effective in dealing with trade shocks. The final pillar — ‘building a supportive environment’ — recommended sustaining sound macro-economic fundamentals, easing the energy constraints, and strengthening the institutional capacity. “In the DTIS, a set of recommendations has been made for enhancing the trade-related capacity of the country,” said Amitava Chakraborty, additional secretary of the Ministry of Commerce. Once the study is finalised, Bangladesh can easily approach Aid for Trade under the World Trade Organisation (WTO) mechanism. The country can also get assistance from the Enhanced Integrated Framework (EIF), a multi-lateral arrangement of assistance for the Least Developed Countries (LDCs). Mr Chakraborty also said the DTIS has already identified some growing sectors, having more potential to grow in future. It has also set an action plan to support these sectors and enhance the trade volume. When contacted through email, Dr Sanjay Kathuria, WB Economist and also one of the task-team leaders for the report, told the FE that the DITS is now in the process of being published.   “We hope that the published copies will be available by November 2015,” he said. On benefit of the DTIS, the WB economist said the report analyses as to how Bangladesh can maximise its gains from being engaged with the global economy.   “Jobs based on foreign demand, such as those in the garment sector, are crucial for Bangladesh to provide better quality jobs for two million people entering as workforce each year.” “The DTIS suggests actions that will help Bangladesh diversify its exports, take better advantage of regional and global demand, and attract more FDI, among others,” he added. Ratnakar Adhikari, Executive Director of the EIF, told the FE that the DTIS is a flagship report, supported by the EIF that assesses the competitiveness of the country’s economy and of the sectors that are engaged or have the potential to be engaged in international trade. “Through the countrywide analytical study, the DTIS helps countries identify and address constraints to trade, economic growth and sustainable development,” he said in an email reply to the FE. “The DTIS also provides a basis for action by the governments, civil society, private sector and development partner stakeholders to own the trade and development track of a country to secure a strong trading future,” he added.

Finance Minister AMA Muhith deplored that Accord and Alliance-two bodies of buyers from America and Europe-were tightening a throttling noose around the neck of Bangladesh’s garment industry through overreaching safety inspections. “They (Accord and Alliance) were welcomed to help us to attain buyers’ confidence, but their activities have now become a noose for apparel industry. They are exercising extra sovereign power,” the minister said at a meeting with the industry leaders, who spoke of excesses on part of the duo. Expressing concern about their activities Mr Muhith termed such pressure unfortunate. “The most important thing to me is the environment of inspection and pressure for unusual improvement. It is becoming a big pressure. I shall have discussion among us with commerce minister, industries minister, and prime minister. Then I shall call those countries from where Accord and Alliance (members) came,” he said. The minister termed the attempts of the two western coalitions as move to stunt Bangladesh’s progress. “It’s like Bangladesh has grown up too much. Now stop it. It’s an attitude of charging baton. I will settle it with very strong message,” he assured the apparel-makers. Before Mr Muhith made these observations president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Atiqul Islam apprised the minister about the activities of Accord and Alliance when he said the two bodies imposed ‘impossible tasks’ on them. “The Accord and Alliance are inspecting each and every factory in Bangladesh. There is no instance of it globally except 10 per cent random inspection. The factory owners are compelled to meet the requirements according to their will,” he alleged. Mr Islam said each factory is now required to spend Tk 50 million to Tk 100 million to meet Accord and Alliance’s conditions. Otherwise, they are asking buyers not to source garments from those factories. He said due to ‘unnecessary’ spending the cost of production has increased, leading to loss of competitiveness to countries like Cambodia and so. Mr Islam said the sector faces challenge because of Euro, Canadian dollar and Russian Ruble’s devaluation against the US dollar, which led price cut by buyers. The BGMEA president requested the minister to reconsider the budgetary proposal of increasing tax at source to 1.0 per cent from 0.30 per cent and imposition of 1.0 per cent duty on capital machinery imports, among other demands. The ‘Accord on Fire and Building Safety in Bangladesh’ is a five-year legally binding agreement among international labour organisations, non-governmental organisations, and retailers engaged in the textile industry to maintain minimum safety standards in the Bangladesh textile industry: On the other hand, the ‘Alliance for Bangladesh Worker Safety’ was founded by a group of North American apparel companies and retailers and brands who have joined together to develop and launch the Bangladesh Worker Safety Initiative, a binding, five-year undertaking that will be transparent, results-oriented, measurable and verifiable with the intent of improving safety in RMG factories. These two bodies started working in Bangladesh following deadly incidents in Rana Plaza and fire incidents at Tazreen Fashions where hundreds of garment workers died and burnt alive. During the meeting, Mr Muhith said the issue of lowering tax at source and withdrawal of duty on machinery import needs to be consulted among the departments concerned. He assured the apparel-makers that the market conditions of the sector would be taken into consideration as the Prime Minister has “soft corner” for this particular industry. “The softness is because of labour employment which is very important for this country. Every year we get additional 1.8 million labour forces for whom we need to do something. You have excellent record in this case,” the finance minister said. He said in the proposed budget he took a policy to impose at least 1.0 per cent tax on all sectors except essential commodities. Speaking on the occasion president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) AKM Salim Osman MP requested the minister to withdraw the provision of re-audit for paying cash incentives against export. President of the Exporters Association of Bangladesh (EAB) Abdus Salam Murshedy urged the minister to reconsider the income tax on small and medium industries, which is creating serious trouble in investing in this sector. Vice-president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Shafiul Islam Mohiuddin also spoke on the occasion. Former vice-president of BGMEA Siddiqur Rahman, leaders from Bangladesh Textile Mills Association (BTMA) and Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) were also present.

The two foreign factory inspection agencies — the Accord and Alliance — have become an encumbrance for Bangladesh for their stringent conditions, Finance Minister AMA Muhith said yesterday.“The Accord and the Alliance are like a noose around the neck. It is the most concerning issue right now,” he said in a meeting with garment exporters at his secretariat office in Dhaka.The rigorous inspection by the Accord and the Alliance is an attempt to stunt the progress of Bangladesh’s garment sector, Muhith said.“It is like, ‘Bangladesh you have progressed a lot, do not progress anymore, now it’s the time to pause’.”The pressure by the Accord and the Alliance is “unfortunate”, he said. “It is an attempt to deter the progress of the industry, although we had opened our doors to them.”Muhith said the government will sit down with the two parties soon to resolve the problems.The Bangladesh Accord on Fire and Building Safety, a platform of nearly 200 retailers mostly headquartered in Europe, has inspected 1,700 of its sourcing factories.The Alliance for Bangladesh Worker Safety, a platform of 26 North American retailers, has been doing the same on its sourcing factories, whose tally is more than 600.The steep decline of the euro and the dollar is another real problem for the garment industry, according to Muhith.Regarding the plea for a reduction in tax at source from the proposed 1 percent and waiver of the 1 percent duty on import of capital machinery, Muhith said he will discuss the issue with Prime Minister Sheikh Hasina and will consider their demand.Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association, who led the delegation of garment makers, said the sector is set to miss its export target this fiscal year after the three-month political turmoil hampered shipments.Between July last year and May this year, garment exports raked in $22.92 billion, which is up 5.51 percent year-on-year but below the periodic target of $24.26 billion.Now, to meet the yearly target of $26.9 billion, some $3.98 billion has to be earned this month, the closing month of fiscal 2014-15.The garment exporters could hardly send their shipments for three months from January to March, he said.The strong performance by some competing countries such as India, Vietnam and Pakistan is another major reason for the fall, he added. The average export growth of the three countries is nearly 10 percent.Islam also identified some short-term challenges, including lower productivity by workers, higher cost of production and a steep fall of two major currencies — the dollar and the euro — against the taka.“It’s time to find out the root cause of our problems for the sustainability of the garment business and to achieve our $50 billion target by the end of 2021,” he added.