After a three and a half decade of journey, the time has come for the second generation to take over the garment business.A majority of first generation apparel unit owners have already handed over the reins to their sons or daughters, or took them in as partners.Alongside exports, many owners have opened up their own brand stores as Bangladesh is also becoming a potential market with the fast-growing middle-income group.Noir, a fashion brand of export-oriented garment group Evince, also made a foray into retail. With the success of their first branch in Banani in July, owners of Noir have now opened their second store on Satmasjid Road in Dhanmondi on April 3.Brothers Shah Adeeb Chowdhury and Shah Rayeed Chowdhury, directors of Evince Group, operate Noir.“We received a good response with Noir. This is why we opened our second branch within a gap of just ten months. We plan to open two more branches in Dhaka by the end of this year,” Rayeed said in an interview with The Daily Star.Noir sells shirts, punjabis, jeans, chinos, T-shirts, handbags, shoes, belts, ties and bracelets for both men and women. “Our targeted customers are the youth, between 17 and 35 years old,” Rayeed said.Since the growing middle-income group is the target segment, the price range of the items has been fixed between Tk 1,600 and Tk 2,000, he said.On their sales trend, they said it increased during Eid, and they expect a good response for upcoming Pahela Boishakh.Our sales also increased with the onset of winter as we have a good collection of winter clothes,” said Rayeed, who graduated in business management from Pace University in New York.“We have our own design studio for garment product development. Our team of experts develops designs as we know our customers’ choices,” said Adeeb, who graduated in fashion and design from National Institute of Fashion and Technology in New Delhi.The brothers have plans to open Noir shops in Thailand and Malaysia, as they look to expand the brand beyond the national borders.“We have not come out from our main businesses of garment and spinning. We have just opened another venture under the same Evince Group,” Rayeed said. The fabrics used to make the garment items are from their own factories, he added. “We have a lot of scope for business in the domestic market, as people prefer branded goods.”Both the brothers have returned to the country upon graduation to join their family business that is owned by Anwarul-ul-Alam Chowdhury Parvez, former president of Bangladesh Garment Manufac-turers and Exporters Association.

Exports rose 7.43 percent year-on-year to $2.93 billion in March, a development which has brought a ray of sunshine amid the gloomy economic prospects.The figure takes the total export earnings so far in fiscal 2014-15 to $23.24 billion, up 2.98 percent year-on-year, according to data from the central bank.“Our exports could have grown more as we have a lot of work orders from international retailers. But the political unrest has been getting in our way,” said Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association.Garment products account for more than 80 percent of the country’s total export basket.The impact of the current stretch of political unrest would manifest in the export earnings three or four months later, as garment makers bagged fewer than normal orders from retailers between January and March.“We were supposed to grow by 14 percent per month, but 7.43 percent growth is not adequate to achieve the target,” Islam said.The garment exporters though did not face any major difficulties in transporting consignments to the Chittagong port, as the Dhaka-Chittagong highway was free from any major untoward incident, he added.The other reason for the uptick in exports is the pick-up in apparel orders from the US in recent months.After the long downward trend, garment exports to the US have started showing positive movement from March.In the January-February period garment exports to the US registered 2.82 percent growth from the previous year to $881 million, according to data from the US Department of Commerce.After the Rana Plaza building collapse in April 2013, garment exports to the US dropped as retailers were waited for signs of progress in workplace safety.But the retailers have been coming back with a handful of orders after the Accord and Alliance in September last year said more than 98 percent of the country’s garment factories are safe, Islam said.Both Accord and Alliance have completed inspections of more than 1,700 factories across the country and are now monitoring the implementation of the corrective action plans suggested by the inspection engineers.

Garment manufacturers seek waiver of all sorts of interest for the next six months on loan amount they had taken from banks for the sake of the industry as what they said it will save them minimally from being classified in face the ongoing political unrest. The apparel makers also want special incentives on export of garment items on the EU countries to compensate their business loss due to fluctuation of Euro and Rubble against US dollar. The stakeholders of the industry are expected to place a bunch of demands to the government during a pre-budget discussion with the National Board of Revenue (NBR) on April 8, 2015. The demands include keeping source tax on FOB unchanged. NBR, like every year is going to hold a series of pre-budget meeting separately with the stakeholders of different sector from today (Wednesday). Shahidullah Azim, Vice-President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) while talking to daily sun said that the garment sector has been going through a tough time due to the ongoing political turmoil. Referring recent business data, he said that some 40 factories have suffered losses of Tk 189 crore during the ongoing political turmoil. The government should offer special package for the garment makers to cope up with the losses, he opined. It was learnt that the board of directors of BGMEA ahead of the pre-budget discussion of the NBR will fix the demands. Shahidullah Azim said that they will fix the demands before the discussion with NBR scheduled to be held on April 8 next. The garment makers said they will also demand for not raising source tax on FOB, which is 0.30 percent now. According to information, three-month long blockade and hartal programmes paralyzed the garment sector as well as the country’s economy. As a result, the apparel makers are eagerly waiting to get some facilities from the government to cope up with the losses.

Newly-appointed Paki-stani High Commis-sioner Shuja Alam praised Bangladesh for its remarkable progress in the fields of education, health, women development and micro-credit.
“Bangladesh is seen to have improved in many areas of social indicators beyond the South Asian countries and is worth mentionable even among the Muslim countries,” said the envoy during his meeting with Foreign Minister Abul Hasan Mahmood Ali at his office on Tuesday. The high commissioner also appreciated introduction and expansion of solar energy network in rural Bangladesh. Responding to the Pak envoy’s interest, the foreign minister said solar energy plays a vital role in off-grid electrification and supplying power in rural areas. He told Mr Shuja Alam to send a delegation to gather practical knowledge from Bangladesh’s experience in this sector. The high commissioner also held a meeting with State Minister for Foreign Affairs Shahriar Alam and expressed his country’s interest about Bangladesh ready-made garments and ceramic products. He also stressed the need for exchanging business delegations between the two countries to help strengthen bilateral business ties. Welcoming the new envoy, both Mr Mahmood Ali and Mr Shahriar Alam hoped that relations between the two countries will be strengthened further during the new high commissioner’s tenure in Dhaka. Mr Shuja Alam presented his credentials to President Abdul Hamid at Bangab-haban on March 21.

Primark has completed paying over 95 percent of long-term compensations to 668 Rana Plaza disaster victims, who were workers of New Wave Bottoms, a supplier of the British retailer. The retailer made the payments through Brac Bank and bKash to the family members of the dead and injured workers of New Wave Bottoms, Primark said in a statement yesterday. “There are a very small number of claimants yet to receive compensation because either the individuals require a high level of support and/ or the victims and/or their dependants have only very recently come forward,” Primark said. “This approach to compensation involved medical and vulnerability assessments.” Payments have been made according to the impact of the injury and the level of disability. In the case of the dependents of the deceased and missing workers, it was according to actuarial estimates of lost earnings, Primark said. The process has taken time to complete because the company was determined that its approach to compensation should be as fair, rigorous and as sustainable as possible, according to Primark. “The company is supporting victims, or their dependants, in the handful of cases where final payments remain outstanding.” Primark’s total aid stands at $14 million. The company has additionally made a payment of $1 million to the Rana Plaza Donors Trust Fund, chaired by the International Labour Organisation, for distribution to workers in its competitors’ supply chain, according to the statement. Primark has signed the Accord on Fire and Building Safety in Bangladesh, which is carrying out factory building inspections. It has also carried out building surveys of factories in Bangladesh from which it sources garments. Primark will continue to monitor the welfare of victims with long-term injuries or loss of earnings, in conjunction with local partners that have advised the company on its approach to compensation.

Bangladesh’s apparel sector is set to face yet another challenge as its close competitor Sri Lanka is lobbying for duty benefits from the European Union. The two parties held a meeting in Colombo last week, where they discussed the possibility of revival of the ‘Generalised System of Preferences Plus’ status for Sri Lanka. The island nation lost its GSP Plus status in 2010 after the United Nations Human Rights Council (UNHRC) alleged violations of human rights during the civil war. However, given the political commitment by the new Sri Lankan government, the EU decided to consider the case under a special monitoring process. The full application process takes about 10 months. If the status is granted, Sri Lankan exports to the EU will attract lower or no duty. Currently, Sri Lanka is the seventh largest garment exporter in the $450 billion market, with a little more than 1 percent share, according to data from the World Trade Organisation. Bangladesh is the second largest garment exporter after China with a 5 percent market share. The EU is the largest export destination for the country’s garment products, where it has been enjoying duty-free benefits since 1971. In fiscal 2013-14, the country exported more than $14 billion worth of garment items to the EU, according to data from the Export Promotion Bureau. Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh, said the country has to become more efficient to cope with the impending challenge from Sri Lanka. “Obviously, we will lose competitiveness if Sri Lanka is also granted the GSP plus status to the EU, as both the countries will compete with the same garment products,” said Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association. The country’s upper hand in garment trade was already compromised last year when Pakistan was included in the GSP Plus scheme. Bangladesh accounts for around 13 percent of the apparel items that enter the EU, meeting 25 percent of the region’s demand for shirts, T-shirts, sweaters and trousers. In 2014, Sri Lanka’s apparel exports to the EU increased 10.5 percent year-on-year to $2.16 billion. “Sri Lanka should capitalise on its advantage of a well-qualified labour force to move further up the value chain,” according to a study by the Standard Chartered Bank released in January. “The continued provision of unique design services and products, further mechanisation, and effective branding could help it retain market share. Sri Lanka could also benefit by strengthening its position in non-traditional markets like the Middle East, India and China,” the study also said.

The Children’s Place has pledged to contribute $2 million to the Rana Plaza Donors Trust Fund to compensate the victims of the factory disaster that killed over 1,135 people. The Children’s Place, in a statement on Monday, said it would make a $2-million contribution to help the trust fund meet its goal of raising $30 million for the injured and victims’ families. Rana Plaza Donors Trust Fund is very close to reach its much-needed $30 million, which would be $29.5m after realisation of the Children’s Place fund. According to the coordination committee, the fund already received $27.5m as of April 24. On April 23, Children’s Place – working with International Labour Organisation (ILO) – convened a conference call of major brands and retailers in an attempt to fill the funding gap by the second anniversary of the Rana Plaza disaster, said Clean Clothes Campaign. This call raised over $1 million in donations to the fund and in addition to the donations, Children’s Place contributed another $2 million to the fund, said the Campaign. The Children’s Place is an American specialty retailer of children’s apparel and accessories. “We have been calling on brands to work together to collectively resolve the funding crisis for months, and we welcome the initiative of The Children’s Place in doing so now,” said Sam Maher of the Clean Clothes Campaign. There remains hope that brands and retailers will continue to step up and make additional contributions in order for entirely making up the fund of $30 million, the amount required to provide the survivors and victims’ families as compensation, said Maher. Walmart has for months been delaying any further donation, claiming that the Alliance would instead be making a significant payment, Maher said, adding that with only $2.7 million left, the Alliance is presented with a unique opportunity to finally close the gap by making good on its promise by May Day and there is no excuse for any further delay.” “We have received $27.5 million from donors and need another $2.5m to complete the compensation, Ramesh Chandra Roy, secretary general of IndustriAll Bangladesh Council, and member of the coordination committee, told the Dhaka Tribune. “We are negotiating with Mango, a retailer, for $2m to make full-fledged compensation.” Prime Minister Skeikh Hasina has so far distributed over Tk15.38 crore as compensation to 976 deceased victims’ family while Tk4.10 crore to 38 severely injured victims. The Rana Plaza Coordination Committee also paid Tk76 crore, which is 70% of the compensation to the injured and the family members of deceased and missing workers. On April 24 in 2013, Rana Plaza, which housed five garment factories, a shopping complex at Savar, collapsed, killing 1,135 workers and injuring over 2,500 workers.

Source: https://www.dhakatribune.com/business/2015/apr/30/childrens-place-give-2m-rana-plaza-donors-trust-fund#sthash.ZRcT0nDf.dpuf

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has urged the National Board of Revenue (NBR) to continue and settle down the existing 0.30% tax at source on export for the next five years. The leaders of the apex body have also requested the NBR to exempt the apparel makers from all kind of tax including import-duty, Value Added Tax (VAT) and Advance Income Tax (AIT) on the import of construction materials for the factories to be constructed in Garment Economic Zone. BGMEA President Atiqul Islam came out with a set of recommendations to the NBR for considering in the budget for the fiscal year 2015-16 at a meeting with revenue body held at its headquarters in the capital. NBR Senior Member Farid Uddin chaired the meeting. He also demanded same sort of tax benefits for importing Fire Proof Colour Coating to be used as pre-fabricated building materials. Attending the meeting, Atiqul said: “We’ve introduced a website called ‘fair factory clearing house’ to meet the demand from the buyers following devastating Rana Plaza collapse.” “Buyers representing 220 brands from across the world can now have updated information on 1700 factories under the platform of BGMEA. They can also be informed about any crack or any error in the factories from our website, so no factories excepting the compliant ones can run business in Bangladesh,” he said. Regarding the upcoming budget, the BGMEA President opined that the budget was set to be a challenging one. Demanding special benefits for RMG sector from NBR in this coming budget, he also recommended the NBR to continue income tax at a minimised rate of 10% for the next five years. The other demands from the apparel makers include duty free import of fire preventing and energy saving machinery for a compliant and green industry, withdrawal of authority from ‘Custom Valuation and Internal Audit Commissionerate’ in regard to the inspection of bonded warehouse benefits enjoyed by export oriented apparel factories, finalisation of 3% interest rate on loans against Effluent Treatment Plant construction, etc. In case of VAT, the association proposed total exemption of VAT on the use of gas, water and electricity. Atiqul Islam requested the NBR to exempt the due VAT piled up on the purchase of local products from 2005 to 2012. “We are enjoying VAT exemption on purchase of products from local market since 2013, but now, the NBR is claiming VAT from us for the previous years that we are unable to pay now,” he said. Atiqul asked the NBR to exempt them from VAT on different services including laboratory test charge, consultancy charge, compliance audit charge, legal consultancy charge, CSR-related charges, building construction charge, courier service charge etc. The NBR should allow the apparel exporters to get 2% special cash incentive, instead of current 0.25% on free on board (FOB) prices, opined the BGMEA. In response, NBR member Farid Uddin praised the apparel manufacturers for three reasons-contribution to the country’s foreign currency income, employment generation and women empowerment, and also for branding Bangladesh abroad. He also stressed on a partnership among NBR, Bangladesh Bank, Banking Institutions and businesses to go forward with integrated approach. At the same meeting, the NBR also discussed with the representatives from Bangladesh Knitwear Manufacturers & Exporters Association (BKMEA), Exporters Association of Bangladesh (EAB) and Bangladesh Garments Accessories & Packaging Manufacturers & Exporters Association (BGAPMEA). BGAPMEA President Rafez Alam Chowdhury urged the NBR to authorise the association to give Utilisation Permission (UP) to its members. He also noted that NBR should allow the organisations to avail continuous or extension of the bond facilities for the members of BGAPMEA to boost export. BGAPMEA’s other demands include duty-free import of materials for pre-fabricated building construction, incentive package for exporters, allowing each export-oriented factory with duty free import of a delivery van for product distribution, and consideration of whole factory premises as bonded area. Meanwhile, the BKMEA requested NBR to introduce tax at source on cost of making, instead of free on board prices, increase of cash incentive at 8% from existing 5%, duty and VAT free import of fire safety equipments, and duty free import of all retail machinery.

Source: https://www.dhakatribune.com/business/2015/apr/30/bgmea-keeping-03-tax-source#sthash.ZHQwtHyM.dpuf

Garment makers have sought exemption from VAT, duty and advance income tax (AIT) while importing construction materials in order to help establish Garment Palli (garment zone) at Baosia for expediting the setting up process of the zone by encouraging the entrepreneurs. They also sought budgetary facilities on duty, VAT and income tax in different dimensions to cover up the losses that the garment makers incurred due to the recent political turmoil and in the aftermath of Rana Plaza collapse. The garment makers made the call to the government at a pre-budget meeting held ahead of the budget for the next fiscal with the National Board of Revenue (NBR) in the capital on Wednesday. To reach the goal of exporting goods worth $50 billion by the year 2050, there is no alternative to work from under a single platform, said Md Atiqul Islam, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA). He called upon the government to help the entrepreneurs relocate the factory buildings by offering duty exemption on import of construction materials. To help the entrepreneurs of the garment sector make the industry green and safer, the government should offer duty exemption on import of all fire safety equipment and other machinery, Atiqul opined. He also demanded withdrawal of the additional duty under the Duty Evaluation and Internal Examine Commissionerate to simplify the bonded warehouse facilities for the garment makers. Calling upon the government for extending the existing source tax rate which is 0.3 percent now by another five years, the BGMEA leader said after Rana Plaza incident, the country’s garment sector has started fledging its wing with utmost transparency and accountability, Atiqul said. He suggested the government to provide 2 percent cash incentive on FOB which is 0.25 percent now to protect the industry from the present situation. AH Aslam Sunny, First Vice President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Abdus Salam Murshedy, former president of BGMEA and president of Exporters Association of Bangladesh, Rafez Alam Chowdhury, President of Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA), were present at the meeting, chaired by Farid Uddin, Member of NBR. Submitting a 33-point demand before the NBR, Aslam Sunny said that there is no alternative to promote the apparel industry to ensure thriving economic growth side by side generating employment for a large number of people. The BKMEA demands included taking income tax from cost of manufacturing of the garment items, providing duty exemption on import of machinery related to fire safety, providing loan at a low interest rate, to help entrepreneurs obtain Leed Certificate of the US Green Building Council by establishing green factory buildings and offering zero percent duty on import of machinery of effluent treatment plant. He also demanded for waiving VAT imposed on import of pre-fabricated building structure. Demanding bond facility in the next budget, Rafez Alam at the meeting said that accessories and packaging sector has been playing a vital role to keep the garment sector vibrant. Reiterating duty exemption on fire safety equipment and pre-fabricated building structure for the apparel and accessories industries, Rafez said it would help the accessories and garment sector grow further with compliance.

Source: https://www.daily-sun.com/print/business/2015/04/30/500688#sthash.eakGQK5K.dpuf

A total of $23.5 million funds has so far been deposited with the Rana Plaza Trust Fund till this month, two years after the worst industrial tragedy, though it was targeted to collect $30 million under the fund, which has slowed down the compensation process. Of the amount, around $14 million have been disbursed among the victims of the Rana Plaza collapse as of April 24 last, according to information. Sources said that 29 retailers whose garment factories were housed at Rana Plaza came forward with other monitoring bodies to help the victims overcome the losses they incurred due to the disaster. Though representatives of the Rana Plaza Trust Fund are hopeful of collecting influx of fund immediately, the labour leaders said delay in contributing to the Trust Fund reflects apathy of the retailers in this regard. In September 2013, representatives from the government, the garment industry, both local and international trade unions and non-governmental organisations came together to form the Rana Plaza Coordination Committee. With the UN agency International Labour Organisation (ILO) acting as a neutral chair, its purpose was to develop a comprehensive and independent process that would deliver support to the victims, their families and dependants in a predictable manner consistent with international labour standards. This process was agreed in late 2013, and established through an ‘arrangement.’ The arrangement has established a claims process, which will be implemented by a range of local organisations and international experts, who will support victims, their families and their dependants to submit claims, assess the level of payments to be provided to each beneficiary, undertake medical assessments and provide follow-up support where needed. These payments will be funded through the Rana Plaza Donors Trust Fund which is open to contributions from any organisation, company or individuals wishing to support the delivery of financial and medical support to the Rana Plaza victims’ families. But it was learnt that many major retailers are yet to contribute to the funds resulting in delay in the compensation process. The retailers those contributed to the fund include Astraea Lesbian Foundation for Justice, Auchan, Benetton Group, Bonmarché, C&A Foundation, Camaïeu, Debenhams, El Corte Inglés, Everlane, G. Güldenpfennig GmbH and H&M Conscious Foundation. The delay of retailers in contributing to the Rana Plaza Trust Fund has slowed down the compensation process, said Sirajul Islam Rony, President of Bangladesh National Garment Workers League. The buyers are obliged to contribute to the fund, but it is their moral obligation to look after the workers of the sector, he opined. We are hopeful of raising the fund to its desired level immediately, said Shahidullah Azim, member of Rana Plaza Trust Fund on behalf of the Bangladesh Garment Manufacturers and Exporters Association. He said that many major retailers will join the platform shortly to help the victims. Mentionable, the compensation process is following the 121 convention of ILO. The amount of funds, committed in written pledges, is yet to be received is US $4.56m.

Source: https://www.daily-sun.com/print/business/2015/04/30/500687