fbpx
Facebook RSS Twitter Youtube
23 C
Dhaka
Wednesday, January 22, 2025
Facebook RSS Twitter Youtube
Home Blog Page 4

Results from ITMF’s 29th Global Textile Industry Survey (GTIS)  – November 2024

POST BY
RMG Bangladesh
-

Dr.  Christian Schindler, Director General & Dr. Olivier Zieschank, Director

International Textile Manufacturers Federation (ITMF)

Zurich, Switzerland  – December, 2024

A) Business situation deteriorated slightly, but slow long-term improvements persist

The 29th ITMF Global Textile Industry Survey (GTIS), conducted in November 2024, analysed the business situation across regions and market segments in the global textile industry. Globally, 38% of participants rated the business situation as “Poor,” 42% as “Satisfactory,” and 20% as “Good,” resulting in a balance of -17 percentage points (pp). This represents decline since the last survey (-13pp) but shows recovery from the -46pp low of November 2023 (see Graph 1 and 2).

Graph 1: Business Situation (World balance), September and November 2024

Graph 2: Business situation (World balance*) since May 2021

*Balance = share of respondents answering good vs. poor Source: 8-29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024) | last data point = November 2024

The global textile value chain continues struggling with a very difficult business environment that is marked by relative weak demand and elevated costs resulting in low profit margins (see Article 6). Order intake has improved slightly but is still in negative territory resulting in relatively low capacity utilisation rates. Nevertheless, it is worthwhile noting that 20% of companies are reporting good business and 42% are satisfied. After “Weak demand”, the next biggest concern is “Geopolitics”. Companies are worried that the military conflicts (Russia’s invasion of Ukraine and the war in Gaza/Lebanon) as well as the immanent trade conflicts (various tariff increases were announced by the incoming Trump-administration) will continue to hamper global growth. The IMF is forecasting that global economic growth in 2025 will be 3.2%, practically unchanged from 2024 (3.3%). While inflation has come down both in the US and Europe to the target levels of around 2% allowing central banks to consider continuing lowering their interest rates, they are at the same time cautious as a potential “tariff-war” might cause new inflation pressure.

Regionally, South America and Africa were the only areas with positive balances (+28 pp and +27 pp, respectively, see Graph 3). South America’s good business situation is closely linked to Brazil’s strong domestic economy and the relatively small trade volume and therefore a reduced exposure to the global economy. The good business situation in Africa is closely linked to the predominant garment industry that is performing better than all the other segments. All other regions recorded a negative balance. South Asia, Europe (including Türkiye and Central Asia), and North and Central America, reported worsening balances. East and South-East Asia showed slight improvements, despite East Asia remaining at -49 pp. While short-term trends show varied regional performances, all regions but Europe reflect long-term improvement from earlier lows.

Graph 3: Business situation by region since May 2021

(1) incl. Türkiye and Central Asia | (2) incl. Central America | (a) incl. woven and knits | (b) incl. auxiliary and dyes, (c) incl. dyed, finished and printed fabrics

Among market segments, the garment industry posted the most favorable result (-5 pp), driven by 23% reporting “Good” business conditions (see Graph 4). Finished fabrics and yarns producers also saw moderate improvements. However, woven and knitted fabrics recorded the lowest balance (-67 pp), with no participants rating conditions as “Good.” Long-term recovery trends are currently only visible in the garment and to a weaker extent in the home textile segments.

Graph 4: Business situation by segment since May 2021

The global textile value chain continues struggling with a very difficult business environment that is marked by relative weak demand and elevated costs resulting in low profit margins. Order intake has improved slightly but is still in negative territory.

B) Global textile industry remains optimistic about future business prospects

ITMF’s 29th Global Textile Industry Survey (GTIS) surveyed the global textile industry’s outlook for the next six months. It found a positive global sentiment with a balance of +27 percentage points (pp) between optimistic and pessimistic responses (see Graph 5). This marks the second consecutive month of improvement. Since the beginning of 2023 business expectations are in the range between +20 and +30 pp. This positive outlook did not change even though the business situation has not improved significantly since. This conundrum illustrates that companies have not expected this difficult business environment – above all weak demand – to persist for such an extended period. They nevertheless remain optimistic about the future.

Graph 5: Business expectations (World balance*) in September and November 2024

Graph 6: Business expectations (World balance*) since May 2021

*Balance = share of respondents who answer more or less favourable | Source: 8-29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024) | last data point = November 2024

Some incremental improvement of the business situation can be observed in the last 9 months justifying companies’ replies of a more favourable business environment in six months’ time. Nevertheless, anecdotal evidence suggests that most companies did not anticipate that weak demand would remain the main concern for such a long time. Many experienced company representatives say that they have never seen such a long period of relative low order income in their career.

Regionally, South America reported the most optimism at +60 pp (see Graph 7), followed by North and Central America (+38 pp) and South Asia (+33 pp). While South-East Asia and Africa expressed also a positive outlook (both at +27 pp), Europe (+16 pp) and East Asia (-11 pp) lagged. Expectations have improved over the past year in all regions except East Asia, where they deteriorated, and Africa, where they stagnated.

Graph 7: Business expectations by region since May 2021

(1) incl. Türkiye and Central Asia | (2) incl. Central America | (a) incl. woven and knits | (b) incl. auxiliary and dyes, (c) incl. dyed, finished and printed fabrics | Balance = share of respondents who answer more or less favourable | Source: 8-29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024) | last data point = November 2024

By segments, yarn producers ranked highest at +41 pp (see Graph 8), followed by producers of fabrics (+33 pp) and fibres (+25 pp). Home textiles and technical textiles producers also reflected positive sentiment, albeit with some recent declines. Producers of textile chemicals/ dyes/auxiliaries remained the lowest at +15 pp, though still improved from earlier lows. Overall, the industry reflects cautious optimism with steady recovery trends across most segments.

Graph 8: Business expectations by segment since May 2021

C) Order intake improved globally with South America and garment sector leading

ITMF’s 29th GTIS also evaluated order intake sentiment. While 42% of participants globally rated order intake as satisfactory, the balance of positive versus negative responses improved to -12 percentage points (pp), slightly up from -14 pp in September 2024 and up from a low of -50 pp in November 2023. Graph 9 shows that order intake has improved continuously since November 2023, though the balance remains in negative territory.

Graph 9: Order intake (World balance*) since May 2021

Expectations for order intake indicate that companies are anticipating a further improvement going forward into 2025 (see Graph 10). Despite the business environment remaining very challenging, brands and retailers have steadily reduced their inventory levels during the past 24 months. This will eventually force them to place higher and/or more frequent orders.

Graph 10: Order intake (World balance* and expectations)

*Balance = share of respondents answering good vs. poor | Source: 8-29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024) | last data point = November 2024

Regionally, South America exhibited the strongest order intake performance (see Graph 11), achieving a balance of +40 pp, driven by 44% of respondents rating conditions as “Good” (see Graph 11). Africa followed with a neutral balance of +/-0 pp, while Europe reported the weakest sentiment at -41 pp. Trends indicate improvement in most regions, though South Asia, Africa, and Europe have seen short-term declines.

Graph 11: Order intake by region since May 2021

By segment, the garment industry recorded the highest sentiment with a balance of +6 pp, reflecting an ongoing recovery from past lows (see Graph 12). Conversely, the textile machinery industry was the weakest segment at -62 pp. Despite overall global improvement, challenges remain.

Graph 12: Order intake by producer type since May 2021

a) incl. woven and knits | (b) incl. auxiliary and dyes, (c) incl. dyed, finished and printed fabrics | Balance = share of respondents answering good vs. poor | Source: 8-29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024) | last data point = November 2024

D) Weak demand remains THE key concern

The 29th ITMF Global Textile Industry Survey (GTIS) also examined key concerns among textile industry participants. “Demand“ remained the top global concern, cited by 60% of respondents, although its significance has declined over recent months. “Geopolitics” and “lack of talents / workers” followed, with 41% and 31%, respectively (see Graph 13).

Graph 13: Major concerns in September vs. November 2024

That 60% of participants saw in November 2024 weak demand as THE major concern (down from 67% in September) reveals that companies are still struggling to keep their capacities running at acceptable rates on average. Interestingly, cost concerns are not among the top 3 concerns. Of course, costs are still important concerns, with “high energy prices”, “high raw material prices”, and “high logistic costs” reaching 28%, 25%, and 17% of respondents, respectively, but they do not dominate the concern landscape as they did in previous years.

Elevated “energy prices” remain a major problem in some countries like Bangladesh or Pakistan, due to a shortage of supply. That “geopolitics” was ranking second in November 2024 did not come as a surprise with two major conflicts – Russia’s invasion of Ukraine and the war in Gaza and Lebanon – still waging on. The uncertainty of the future US administration’s direction under President Donald Trump certainly contributed to “geopolitics” coming as the second major concern. To what extent the new US-administration will disrupt global trade by launching a “tariff-war” remains to be seen.

It is interesting to see that “Lack of talent/workers” has become a major concern for the textile value chain. This result is mostly felt in South America and must be regarded as a structural concern across all regions and segments, not only a short-term problem.

“Inflation” was a major concern during the year 2023. It peaked at 48% in May 2023 but came down continuously afterwards. Since July 2024 inflation as a concern rose again from 17% to 25%. It seems that it is unclear for many survey participants whether inflation is back to normal levels allowing major central banks to lower interest rates further or not. A “tariff-war” would most likely lead to higher import prices and eventually to higher inflation rates.

Graph 14: Major concerns since January 2022

(1) Lack of or delayed receipt of | (2) Adoption of | Source: 8- 29th ITMF Global Textile Industry Survey (29th: 18-25.11.2024)

E) Inventory levels keep falling

The 29th ITMF Global Textile Industry Survey assessed inventory levels across the global textile value chain. The results show that levels remained average despite a slight decrease, reflecting the challenging business environment the entire textile value chain finds itself in since the beginning of 2023 (see Graph 15). A relative low order intake due to weaking demand and high inventory levels forced companies across all segments to manage their inventories well according to their respective demand requirements.

Graph 15: Inventory level* How would you rate your current inventory level?

At brand and retail level, apparel inventories in the US have stabilized overall in the past few months at around USD 89 billion in September 2024 after falling from a peak in September 2022 of around USD 100 billion (see Graph 16). While wholesale inventories continued falling slightly, at retail level they rose. It seems that brands and retailers have increased inventories slightly with seasonal merchandise going into the festive season, while wholesalers are not yet feeling the need to increase their stocks.

Graph 16: Evolution of apparel inventory levels in the USA [last data point = Sep 2024] *

* Retail Estimates of End-of-Month Retail Inventories, Clothing and clothing accessories stores, US census | Wholesales: Adjusted estimates of Monthly Sales of Merchant Wholesalers, Except Manufacturers’ Sales Branches and Offices, Apparel, Piece Goods, & Notions, US census | Source: US Census, illustration: ITMF

Bangladesh business leaders optimistic for 2025 amid political uncertainty, says EIB survey

POST BY
RMG Bangladesh
-

Bangladesh’s business leaders are expressing optimism about potential growth in 2025, contingent on controlling inflation and successful banking reforms. However, concerns about political stability and public order loom large, according to a recent survey conducted by Economic Intelligence Bangladesh (EIB), a collaboration between The Business Standard and DataSense.

The survey reveals that 45 per cent of business executives believe that managing inflation and implementing necessary reforms in the banking sector are the most significant opportunities for enhancing their performance in the coming year. The report highlights those sectors such as ready-made garments (RMG), furniture, tea, aviation, and pharmaceuticals are particularly focused on these developments.

In addition to domestic concerns, leaders are eyeing increased foreign exchange reserves and the prospect of Donald Trump returning to the US presidency as potential catalysts for business growth. However, a striking 75 per cent of respondents expressed fears that political uncertainty and instability in law and order pose the greatest risks for businesses in 2025. This survey was conducted in December 2024, shortly before interim Chief Adviser Prof Muhammad Yunus indicated that national elections might occur at the end of 2025 or in early 2026.

Furthermore, the survey indicates that 60 per cent of executives consider high-interest burdens from loans to be a significant downside for the upcoming year, with high energy and utility prices and bureaucratic inefficiency also highlighted as pressing concerns.

Md Abdul Jabbar, managing director of DBL Group, emphasised the need to minimise corruption to boost investor confidence and improve the business climate. Meanwhile, RN Paul, managing director of Pran-RFL Group, urged business leaders to remain politically neutral and focus on their operations, advocating for collaboration with the government to facilitate business growth.

Regarding expectations for production growth and costs, the outlook remains cautious. While 60 per cent of respondents are optimistic about earning growth—15 per cent of whom anticipate high earnings—80 per cent predict an increase in production costs. Of those, 50 per cent expect a moderate rise, while 30 per cent brace for a steep increase, raising concerns about profitability in the year ahead.

A Discussion on the Garment Sector

POST BY
RMG Bangladesh
-

Shovon Islam, owner and MD of Sparrow Industries

Dr. Forrest Cookson, Economist

This article is a discussion between Shovon Islam the owner of Sparrow Industries and Forrest Cookson.  The discussion covered some of the essential issues facing the ready-made garment sector.  The health and development of the sector are the key to the future of the Bangladesh economy over the next decade.  Economic growth is the central objective of Bangladesh. Achievement of common aspirations of a higher living standard, a more equal distribution of income and wealth, better infrastructure, improved health and education all depend on achieving a strong growth of the economy.  The growth of the economy in FY24 was very low, well below 4%. Declining exports and imports, little investment, lower government consumption expenditures all lead to GDP growth of 0-1% at best.  Return to growth of the economy is dependent on export growth. Over the next decade the only way that export growth of 7-9% can be achieved is through expansion of the garment sector.  Diversification of exports has been an aspiration for decades, but no progress has been made.  While there are good prospects for diversification it will take many years before these can become significant; growth over the next decade depends on the RMG sector.

We began discussing the tax and subsidy position.  There is a 1% tax on the earnings in the garment sector when the funds are received in Bangladesh.  There is a subsidy of 0.3% received by the exporting company based on the shipment documents. The administration of these two are different.  The 1% tax is simple, Bangladesh Bank takes it off the payments from the foreign buyers.  The management of the subsidy is difficult.  Shovon explained that it takes a long time to obtain this subsidy and there is a large amount of documentation needed.  It is much simpler to combine the two and collect a tax of 0.7% on the received payments.   About 10% of the costs of the garment are local on which the VAT is paid.  Finally, the corporate tax must be paid 15% for regular factory and 12% for green factory.

The second topic is the old issue of the large number of Sri Lankan and Indian technicians working in the industry.  The Sri Lankans came when the garment industry collapsed with the civil war.  Shovon observes that the garment industry is rebuilding in Sri Lanka and many working here are returning. Conditions are favorable in Sri Lanka with excellent port facilities, well-educated labor force, and law and order.  I asked him why these persons cannot be replaced by Bangladeshi technicians. He was clear that skilled technicians in Bangladesh are rare.  First, the basic education system is poor, and the foundation of reading and arithmetic are not present.  Technical schools and universities do not produce persons interested in doing this kind of work.  It is doubtful if much progress can be made quickly.

I asked about the much discussed question of shifting production from China to Bangladesh.  First there is the issue of the Chinese Economic Zone on the left side of the Kharnapuli River. This we believe is not yet complete although its construction has been going on for years.   I assume that there are issues of electricity and gas, a considerable demand for a major Economic Zone. As Chinese exports have decreased over the past seven years, much of the production has shifted to the domestic market, demand increases with rising income. One must differentiate between the Chinese reducing garment exports as they shift production to domestic markets and shifting part of their export production to other countries. The previous Government had lined up a substantial   volume of Chinese capacity that was prepared to shift to Bangladesh. Shovon indicated that about 30% of this capacity has pulled back due to the revolution in Bangladesh and the rest is waiting to see how conditions develop.  One should be aware that the United States is of course aware of Chinese industry shifting to other locations to avoid the potential rise in tariffs that Trump has threatened. 

Shovon explained that a large volume of woven garments made in Bangladesh were denim, a cotton-based fabric.  The cutting tolerances for denim garments are quite high compared to higher value garments.  A large part of Bangladesh woven exports is made from denim; orders are large so production runs are long.  Bangladesh is very efficient in producing these garments.  Another part of the woven production is of higher quality and is difficult to make in a timely manner.  Before sewing there is considerable preproduction work and great care must be taken with the cutting as the shape of the garment must be exact; the washing must be carefully managed as shrinkage differs for each roll of cloth. Time is short as fabric has to be shipped to Bangladesh, clear customs which takes excessive time; after the arrival of the cloth, preproduction actions take place, the garment is then sewn, washed shipped to Chittagong and exported. Large container ships do not come to Bangladesh due to the shallow Bay of Bengal. Thus, goods are transshipped through Colombo or Singapore. The transport and customs take too much time squeezing the time available for production work.  This is the fundamental reason why most of the woven garments produced are of the simpler type. The Chinese garments shifting to Bangladesh were more complex. The future of the shift of Chinese production to Bangladesh is uncertain.  In fact, there was quite a lot of FDI lined up sourced from China and Japan. With the overthrow of the Hasina government these investors have stepped back to wait to see what happens.  There are clear issues of law and order, political stability, energy availability, and an orderly labor force that have emerged with the Interim Government.  Establishment of law and order will take time, but this is clearly a precondition for FDI.  Political stability comes with an election; everyone knows that there will be an election and until that is completed no one knows if the country will settle down.  The same is true of the electricity supply where gas will be either imported [LNG] or new discoveries will be made to enable increased domestic production.  If gas fields are discovered, it will take some time to develop and begin production. Construction of a large degasification facility will take several years to construct.  While the Interim

Government is doing an excellent job of untangling the power sector issues, there are problems everywhere and this is likely to cause Chinese business to defer final decisions to invest.  There are potential conflicts with the Adami project, uncertainty as to the starting date of the nuclear power plant, and the construction of needed transmission systems.  Finally, there have been regular labor disturbances with the arrival of the Interim Government.  The workers believe that wages are too low and are beginning to assert their demands. Many factories have trouble paying wages. All these factors will slow down investors in the textile and RMG sectors.  The conclusion is that increased capacity of production for the EU or the United State is likely

We took up the development of man-made fibers.  Shovon explained that the before Covid about 80% of the woven garments used cotton fabric and 20% man-made fibers; that has shifted to 55/45 so garments made from manmade fibers are almost half.  However, there are no factories being constructed to manufacture such fibers and the industry must import all the fabric used.  Attracting an investor or two is important as this is an area where demand is growing.  

The sector suffers from poor electricity supply.  This is an area of tremendous importance if exports are going to increase.  The electricity supply faces so many difficulties that one is not optimistic.  Further the government seems to be headed for an increase in the price but it is not clear if the quality and quantity will increase. Similarly, gas pressure is often too low.  Water supply is plentiful but rules from the EU insist that 75% of the water used must be recycled.

A very serious problem is the large amount of non-performing loans held by RMG factories.  The current drive to recover loans will put great pressure on the owners.  If the banks put more pressure on the owners to repay the loans, then the returns, already low will drive many factories into negative return to equity. This will discourage investment to achieve higher productivity and higher capacity.  Shovon believes many, perhaps most, are earning low returns.  Most factories are built with little owners’ equity, rather using all bank loans. The owners take money out of the business allowing the loans to go into default. This worked do long as the banks and the central bank allowed the buildup of bad loans.  Shovon thought that the stock market is too weak and poorly run to be a source of funding for the RMG sector.

We discussed the condition of compensation of the workers.  He was surprised by the newspaper stories of worker protests at the increment award of 4% bringing the total increment in January to 9%.  He said at his factories everyone was cheering when the news came out. We discussed the basic misconception of many.  The wages that are quoted by the Wage Board starting at Taka 12,500 per month are for workers who are just beginning. and does not include overtime.  The overtime rate is twice the basic wage.  Shovon’s average worker is taking home Taka 30,000 per month.  The amount of overtime depends on the volume of orders.  The problem is not the number of orders but the concentration of production on low-cost products where the competition is fierce.  Owners want to produce as much as possible even if they are making very little.  If there is enough overtime, then the salary of the worker is just fine.  In the past there was widespread loan default. The owners took that.

Shovon and I would agree that the only hope for a strong growth of exports is to shift to higher quality products with shorter production runs and of greater complexity.  These are the type of products the Chinese are exporting but at a declining rate.  One obtains the Chinese reduction in exports by raising the quality of the product. Owners must be prepared to invest in new machinery and equipment to raise productivity.  In that way the owners can earn a higher return and repay their loans.

The Government has important work to do.  First, it should try to improve the industrial engineering departments at the universities and at the technical colleges, with greater focus of the course work on the RMG sector.  Everyone should do an internship in a garment factory. In this way replacements for the Indians and Sri Lankans can be developed. 

Second the electricity should be improved.  Elsewhere Cookson has suggested a special distribution system for the garment factories.  The Power Development Board should work out a system for ensuring there is power. This cannot wait but is a matter of immediate need.

Third Chittagong Port can run better.   The Dhaka-Chittagong Highway is crowded but there are no good solutions that would have an impact starting in two years. A preshipment inspection system for all imports for the RMG sector would ease the Customs problems. Turning over management of the air cargo system would be a big improvement,

Oxfam calls for legal protections for Bangladesh’s informal workers

POST BY
RMG Bangladesh
-

During a recent meeting with the Labour Reform Commission, Oxfam underscored the urgent necessity for strong legislation and interventions to safeguard the millions of informal workers in Bangladesh, especially those in the ready-made garment (RMG) industry. Presently, over 85 per cent of the country’s workforce is engaged in the informal sector, where they often contend with hazardous working conditions, financial instability, and exploitation.

The gathering, which took place at Srom Bhaban, included representatives from the government, non-governmental organisations, development partners, media, and civil society, aiming to address the critical challenges confronting these workers.

Oxfam and its collaborators urged the Government of Bangladesh to ratify essential International Labour Organization (ILO) conventions, particularly Conventions C188, C189, and C190, which would provide vital legal protections for informal workers, including those in the RMG sector. The organisation proposed the implementation of minimum wage standards, enhanced access to social safety nets such as health insurance and pension plans, and improved enforcement mechanisms to monitor workplace safety and rights.

Syed Sultan Uddin Ahmed, the Head of the Labour Reform Commission, highlighted the importance of protecting informal workers, stating, “Safeguarding informal workers goes beyond economic factors; it is fundamentally a matter of justice. Recognising their contributions honors the dignity of all individuals.”

Mahfuzul Haque, a former secretary of the Ministry of Labour and Employment, supported this view, emphasising that labor rights are essential for sustainable development. He called for efforts to close the gap between policy and practice to protect the country’s most vulnerable workers, particularly within the RMG sector.

After a resilient 2024, RMG manufacturers hope for a better 2025

POST BY
RMG Bangladesh
-

Bangladesh’s readymade garment (RMG) sector hopes for a better 2025 after experiencing challenges and hurdles throughout 2024, redefining its resilience against all odds. 

Industry insiders were optimistic that 2025 would improve as the global retail market was also improving.

Moreover, the country’s manufacturers took several measures, such as branding, product diversification and workplace safety improvement, which may expedite exports.

A better 2025

RMG manufacturers said that Western buyers began returning to Bangladesh as inflationary pressures eased in their respective countries.

Moreover, exports in 2024 also indicated a brighter 2025 as the trends remain positive despite fierce nationwide movement and political changeover.

Talking to Dhaka Tribune, Faruque Hassan, former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said entrepreneurs are now looking for new markets and manufacturing value-added products.

“If we can reduce corruption and resolve customs and NBR-related issues, 2025 will be a good year for us. Inflation has started decreasing gradually in our major destinations, mainly in Europe and America,” he said, adding that the central banks of many countries are also reducing interest rates.

Consequently, there is a possibility of increasing sales in the retail market, which impacts work orders.

“Buyers are always confident in us due to circularity, green factories, workplace safety, etc. If the global economy turns around, we will benefit from it,” he also said.

Echoing similar sentiments, Mohiuddin Rubel, former director of the BGMEA, believed the Bangladesh RMG industry had potential for qualitative changes as it diversified product lines and explored new markets.

Significant investments in activewear and non-cotton products are emerging within the industry. Nevertheless, the ongoing crisis in sustainable energy has hindered new investments, causing previous investors to struggle, he added.

Rubel was optimistic that 2025 would mark a significant comeback for the global economy and the apparel business. 

He hoped the nation would overcome the ongoing crises, particularly the challenges within the banking and financial sectors.

Challenges that need to be addressed

According to industry insiders, 2025 also holds several challenges for the country’s apparel sector along with enormous opportunities.

Faruque Hassan said Bangladesh’s RMG sector must solve domestic issues in order to seize the above mentioned opportunities.

“We have to ensure an uninterrupted supply of energy and fuel and increase worker efficiency. Moreover, the highest priority should be given to improving the law-and-order situation, ensuring that workers’ unrest does not occur, and ensuring political stability,” he added.

Mohiuddin Rubel said achieving sustainable improvements in industrial relations and establishing stable political and economic reforms are essential for restoring confidence as they dedicate themselves to the immediate future.

“I truly believe these improvements will take shape in 2025,” he added.

RMG resilience against all odds in 2024

The country’s apparel sector experienced a series of challenges and hurdles throughout 2024, redefining its resilience against all odds. 

Industry insiders reported that several domestic issues have negatively impacted the sector this year, including a prolonged energy and fuel crisis, turmoil in the banking sector and recurring labor unrest in the major industrial hubs.

On August 5, a mass uprising led to the overthrow of the Sheikh Hasina government, forcing her to find refuge in India.

Additionally, the change in the political landscape also caused some negative impacts on the sector, including a disturbed law and order situation and ongoing labor unrest.

Faruque Hassan mentioned that while 2024 posed challenges, it also presented opportunities for business recovery as work orders increased alongside improved political stability. He highlighted the fact that international retailers and brands are returning to place work orders due to a rise in sales in the US and EU, indicating a rebound in retail sales.

The quota reform movement began in June and escalated into a mass uprising demanding the removal of then-prime minister Sheikh Hasina.

Curfews and internet outages enforced by the then-government exacerbated the situation in July and August. As a result, apparel manufacturers experienced deadline delays and many were forced to provide discounts to make up for delayed delivery.

Following the fall, on August 5, of the Sheikh Hasina-led government, an interim government led by Nobel Laureate Professor Muhammad Yunus took charge on August 8.

Labour unrest and onwards

Production and shipments were further affected by significant labor unrest that erupted in major industrial hubs on the outskirts of Dhaka in August, following the political change. This unrest continued until October.

The workers’ unrest disrupted the struggling local apparel manufacturing industry as workers abandoned production lines, blocked roads, and chanted demands for higher wages.

For several months, factories in major industrial hubs like Gazipur, Savar, Ashulia, Zirani and Zirabo were closed due to protests and vandalism.

Meanwhile, several manufacturers and union leaders labeled most of the protests illogical, fueled by vested interest groups, and a conspiracy against the sector due to its fast-changing nature.

However, workers, union leaders, and factory owners reached a historic consensus in September on a settlement to their 18-point demand.

In December, the government decided to increase the yearly wage increment of the RMG workers to 9% from the previous 5%.

Export earnings showed hope

Meanwhile, the country’s RMG sector has maintained a moderate export increase throughout 2024 despite obstacles, including worker unrest, an energy crisis, high lending rates, growing production costs, and—most importantly—a change in the political landscape. 

Bangladesh earned $34.71 billion between January and November 2024, a 6.23% increase from the $32.64 billion earned during the same period in 2023, according to Export Promotion Bureau (EPB) data compiled by former BGMEA director Mohiuddin Rubel.

He said this reflects satisfactory year-over-year growth. However, considering the industry’s capacity, it is not significant enough.

“Thus, 2024 has proven to be a year rife with crises and challenges. However, I remain hopeful that 2025 will usher in a revival in global garment trade and improve our export performance,” he added.

No pause in sustainability

Bangladesh has successfully sustained its commitment to industrial sustainability despite the hurdles faced throughout 2024.

Some 24 garment factories earned USGBC LEED certification in 2023. 

In 2024, 26 new factories earned the certification. Of these, 16 received platinum certification, and 10 achieved gold certification.

Bangladesh’s RMG industry now has 232 green factories, showcasing its dedication to sustainable growth. 

Industry insiders said investment in the sector would increase if it could address the aforementioned challenges, and many jobs can be created in 2025. 

They also suggested investing more in man-made fiber to get better prices and increase exports, as demand for specialized garments has been increasing worldwide.

ঝড় ঠেকাতে পারবে পোশাক শিল্প? লক্ষণ কী?

POST BY
RMG Bangladesh
-

দেশের পোশাক শিল্পের জন্য ২০২৪ সাল ছিল সংকটময়। আবার বাজার ফিরতে শুরু করায় নতুন করে আশার আলো দেখার বছরও।

বিদায়ী বছরটি আবারও বিশ্ববাজারে বাংলাদেশের পোশাকের শক্তিশালী অবস্থান প্রমাণ করেছে।

জ্বালানি ও ডলার সংকট, সরবরাহ ব্যবস্থায় বাধা, শ্রমিকদের বেতন বাড়ানোর দাবি, রাজনৈতিক অনিশ্চয়তা এবং ঢিলেঢালা আইনশৃঙ্খলা পরিস্থিতি—এসবই বিদায়ী বছরে পোশাক প্রস্তুতকারকদের জন্য অভ্যন্তরীণ সংকট তৈরি করেছিল।

মূল্যস্ফীতির চাপ কমে আসায় এবং মহামারি ও ইউক্রেন-গাজা যুদ্ধের ধাক্কা কাটিয়ে বাজার ফেরার প্রেক্ষাপটে দেশব্যাপী শ্রমিক আন্দোলন ও রাজনৈতিক পটপরিবর্তনের পর পশ্চিমের ক্রেতারা বাংলাদেশে ফিরতে শুরু করেছেন।

ইউরোপীয় ইউনিয়ন ও যুক্তরাষ্ট্রের মতো বড় বাজারে বাংলাদেশের পোশাক রপ্তানি ঘুরে দাঁড়িয়েছে। জুলাই থেকে নভেম্বরে দেশটির পোশাক রপ্তানি আগের বছরের একই সময়ের তুলনায় ১৬ দশমিক ২৫ শতাংশ বেড়ে এক হাজার ৬১১ কোটি ডলার হয়।

ওয়ালমার্ট-জর্জ, পুমা, এসপ্রিট ও জি-স্টারে পোশাক রপ্তানি করা ডিবিএল গ্রুপের ব্যবস্থাপনা পরিচালক এমএ জব্বার দ্য ডেইলি স্টারকে বলেন, ‘কয়েক মাস আগের তুলনায় এখন ভবিষ্যৎ উজ্জ্বল। পোশাক রপ্তানির ক্ষেত্রে খুবই ইতিবাচক পরিস্থিতি দেখতে পাচ্ছি।’

দেশের রপ্তানি আয়ের বেশিভাগ আসে পোশাক শিল্প থেকে। এই শিল্পে শ্রমিকদের বেতন বৃদ্ধির আন্দোলন ও বর্ধিত মজুরি নিয়ে বছরটি শুরু হয়।

করোনা মহামারির পর বিশ্ববাজারে মূল্যস্ফীতি বেড়ে যায়। এরপর আসে রাশিয়া-ইউক্রেন যুদ্ধ। মধ্যপ্রাচ্যে লোহিত সাগর সংকট ও সংঘাত পরিস্থিতিকে আরও জটিল করে তোলে।

এরপর জুনে কোটা সংস্কার আন্দোলন শুরু হলে পোশাক রপ্তানি ক্ষতিগ্রস্ত হয়।

আন্দোলন দমাতে সরকার জুলাই ও আগস্টে ইন্টারনেট বন্ধ ও কারফিউ জারি করলে সার্বিক পরিস্থিতি আরও সংকটময় হয়ে উঠে।

এমন অবস্থায় পোশাক রপ্তানির ক্ষেত্রে বেঁধে দেওয়া সময় মানতে ব্যর্থ হয় অনেক প্রতিষ্ঠান। অনেককেই দেরিতে চালান পাঠানোর ক্ষতিপূরণ হিসেবে পণ্যের দামে ছাড় দিতে হয়।

সরকার পতনের পর ঢাকার আশেপাশে প্রধান শিল্পাঞ্চলগুলোয় ব্যাপক শ্রমিক অসন্তোষ দেখা দেয়। তা চলে অক্টোবর পর্যন্ত। দেশব্যাপী ছাত্র আন্দোলনের সময়ও উৎপাদন ও চালান ক্ষতিগ্রস্ত হয়।

বেতন বাড়ানো ও বকেয়া বেতনের দাবিতে শ্রমিকরা রাস্তা অবরোধ করেন। ইতোমধ্যে ধুঁকতে থাকা কারখানাগুলোয় পোশাক তৈরি ব্যাহত হয়।

অস্থিরতা, ভাঙচুর ও অগ্নিকাণ্ডের কারণে গাজীপুর, সাভার, আশুলিয়া, জিরানি ও জিরাবোর মতো বড় শিল্পাঞ্চলে বেশ কয়েকটি কারখানা কয়েক মাস বন্ধও ছিল।

গত সেপ্টেম্বরে পোশাক কারখানার মালিক, শ্রমিক নেতা ও শ্রমিকরা মিলে আন্দোলনকারীদের ১৮ দফা দাবি নিয়ে আলোচনা করেন।

ন্যূনতম মজুরি বোর্ড পোশাক শ্রমিকদের বার্ষিক ইনক্রিমেন্ট আগের পাঁচ শতাংশ থেকে বাড়িয়ে নয় শতাংশ করেছে।

চলতি ডিসেম্বরে নতুন ইনক্রিমেন্ট কার্যকর হয়। শ্রম আইন সংশোধন ছাড়া অন্যান্য দাবিও পূরণ করা হয়েছে। আগামী মার্চের মধ্যে আইনটি সংশোধনের প্রতিশ্রুতি দিয়েছে সরকার।

অনেকে ভেবেছিলেন অস্থিরতার পর উত্পাদন আবার শুরু হবে। তবে কয়েকটি প্রতিষ্ঠানের পরিস্থিতি আরও খারাপ হয়। যেমন, বেক্সিমকো গ্রুপের ১৬ কারখানা থেকে ৪০ হাজারের বেশি কর্মী ছাঁটাই হন।

বিদায়ী বছরে রপ্তানি তথ্য সংশোধন করা হয়। আগে ভুল গণনার কারণে রপ্তানি আয় অতিরঞ্জিত ছিল।

চূড়ান্ত হিসাব অনুসারে, ২০২৩-২০২৪ অর্থবছরে পোশাক খাতের আয় হয়েছে ৩৬ বিলিয়ন ডলার। রপ্তানি উন্নয়ন ব্যুরো (ইপিবি) হিসাব করেছিল ৪৭ বিলিয়ন ডলার।

বাংলাদেশ পোশাক প্রস্তুতকারক ও রপ্তানিকারক সমিতির (বিজিএমইএ) সাবেক সভাপতি ফারুক হাসান ডেইলি স্টারকে বলেন, ‘বিদায়ী বছরটি সংকটময় ছিল। তবে রাজনৈতিক স্থিতিশীলতার সঙ্গে কার্যাদেশ ফিরে আসায় ব্যবসা পুনরুদ্ধারের বছরও এটি।’

তিনি আরও বলেন, ‘যুক্তরাষ্ট্র ও ইইউতে খুচরা বিক্রি বেড়ে যাওয়ায় আন্তর্জাতিক প্রতিষ্ঠানগুলো এখন কার্যাদেশ নিয়ে ফিরে আসছে।’

২০২৪ সালকে ‘সবচেয়ে বেশি পণ্য রপ্তানির বছর’ হিসেবে আখ্যা দিয়ে বিডিএল গ্রুপের ব্যবস্থাপনা পরিচালক এমএ জব্বার ডেইলি স্টারকে জানান, তারা আন্তর্জাতিক ক্রেতাদের কাছ থেকে ব্যাপক হারে কার্যাদেশ পাচ্ছেন।

তার মতে, ‘এখন এই খাতের উন্নতির জন্য আমাদের আরও কাজ করা দরকার।’

তিনি পোশাক খাতের জন্য ইপিবির মতো পৃথক প্রতিষ্ঠান গড়া এবং আরও বাজার পেতে কৃত্রিম সুতা ও স্পোর্টসওয়্যার বিভাগে বিনিয়োগ বাড়ানোর সুপারিশ করেছেন।

ব্যবসা বাড়াতে রাজনৈতিক স্থিতিশীলতার আহ্বান জানিয়েছেন ঢাকা চেম্বার অব কমার্স অ্যান্ড ইন্ডাস্ট্রির (ডিসিসিআই) সাবেক সভাপতি রিজওয়ান রহমান।

তিনি মনে করেন, আইনশৃঙ্খলা পরিস্থিতির তেমন উন্নতি হয়নি। এখনো ব্যবসার পরিবেশ স্বাভাবিক নয়।

বিজিএমইএর সাবেক সভাপতি ফারুক হাসানের মতে, রাজনৈতিক ও শ্রমিক অসন্তোষ ছাড়াও বিদ্যুৎ ও জ্বালানি সংকট এ খাতে বিনিয়োগ কমিয়েছে। ফলে এ বছর এ খাতে কাজের সুযোগ খুব বেশি হয়নি।

বিশ্বব্যাপী বিশেষায়িত পোশাকের চাহিদা বাড়ছে উল্লেখ করে তিনি ভালো দাম পেতে ও রপ্তানি বাড়াতে কৃত্রিম সুতায় আরও বিনিয়োগের পরামর্শ দেন।

Clog London announces plans to open 24 stores in the coming year

POST BY
RMG Bangladesh
-

Clog London has unveiled plans to open 24 new stores in the next year. The expansion will include outlets in Tier-1 and Tier-2 cities, focusing on both company-owned and franchise-operated formats. Additionally, the brand is gearing up for further growth by securing spaces in numerous upcoming shopping centres over the next few years.

“We aim to ensure the success of each store as we expand,” said Gopal Rathor, Director of Clog London, in an interview with India Retailing. “Rising consumer demand and digital adoption have driven our momentum, allowing us to align with trends and advance our brand’s digitisation.”

Since its inception in 2018, Clog London has grown fivefold, offering a blend of comfort and trend-driven styles. The brand operates as an omni-channel retailer with exclusive brand outlets across Delhi NCR and Haryana, complemented by its presence on leading e-commerce platforms such as Ajio, Myntra, and Amazon India.

As the brand continues its expansion, its strategy includes increasing its presence through shop-in-shop formats and exclusive brand outlets. With a focus on consumer preferences and digital integration, Clog London is positioning itself as a leading name in India’s footwear and accessories market.

North India Cotton Yarn Prices Range-Bound in Final Days of 2024

POST BY
RMG Bangladesh
-

In the final days of 2024, cotton yarn prices in North India have remained largely range-bound, showing limited movement despite fluctuating market dynamics. The price stability comes as demand from key domestic and international markets has been inconsistent, with manufacturers and traders adopting a cautious approach ahead of the new year.

Cotton yarn prices have been under pressure throughout the year due to various factors, including fluctuating cotton prices, rising input costs, and shifting demand patterns. Despite these challenges, prices in key North Indian markets like Ludhiana, Panipat, and Delhi have seen only marginal changes in recent weeks, as mills and traders attempt to balance production costs with customer expectations.

The Indian cotton yarn market has been experiencing mixed trends. While the domestic textile sector, especially in woven fabric and knitted apparel production, has maintained a steady demand, exports have been impacted by global economic factors, such as currency fluctuations and reduced orders from major markets like the US and EU. However, some industry experts suggest that there could be slight upward pressure on yarn prices in early 2025, depending on the outcomes of the upcoming cotton harvest and any changes in global cotton prices.

As the year closes, textile manufacturers in North India are closely monitoring the cotton market and its trends. While the cotton yarn prices have remained largely stable, the broader outlook for 2025 will depend on international demand, raw material prices, and the ongoing economic challenges faced by the sector.

Union leaders demand emergency fund for laid-off RMG workers

POST BY
RMG Bangladesh
-

A group of union leaders of the garment sector today urged the government to form an emergency fund to provide financial benefit to the laid-off workers, as many are still deprived.

The union leaders made the demand at a meeting with the members of the Labour Reform Commission at the Department of Labour in Dhaka.

To press home their multiple demands, the leaders gave an example of over 40,000 laid-off workers of 16 textile and garment factories of Beximco Group.

They said the Beximco workers will now face trouble in obtaining the service benefits as the group has been struggling to pay the workers since the arrest of its vice chairman, Salman F Rahman.

The Beximco management announced the termination of workers, citing a lack of international work orders as the reason.

Many other factories may also lay off workers amid the current economic situation, the leaders said.

Uncertainty about accessing service benefits increases when workers are laid off in such circumstances, and an emergency fund could be of great help in ensuring these workers receive their deserving service benefits, they said.

The leaders emphasised that neither the government nor the owners alone can fully cover the service benefits; instead, a fund jointly formed by the government and the owners can serve this purpose.

The Labour Reform Commission has been holding a series of meetings with the workers, and 12 meetings have so far been held, said Syed Sultan Uddin Ahmed, chairman of the commission.

The commission will hold 60 meetings with different sectors to receive recommendations for the legal protection of workers of all sectors and setting a national minimum wage, he said.

In today’s meeting, the union leaders said the workers are not properly getting help from the central fund, which was set up for garment workers’ welfare in 2016 where the country’s apparel makers contribute 0.03 percent of their export proceeds in each fiscal year.

The leaders also spoke about establishing a better working environment and introducing a rationing system for the workers, said the chief of the commission, the tenure of which will come to an end in mid-February next year.

The labour law should be reformed to ensure that workers receive justice, he said.

Closing factories is not a solution, and established factories need assistance to remain operational, he also stated.

The government should also be aware that many may close factories and terminate workers in order to receive bank loan waivers, Ahmed said.

The government should identify whether the owners are laying off the workers willingly or there is any valid reason, he said.

In the meeting, Montu Ghosh, president of Garments Workers’ Trade Union Centre, suggested introducing strong provision in the labour law so that the workers get payments in time and their jobs remain secured even if they get involved in trade unionism.

Kazi Md Ruhul Amin, general secretary of the Bangladesh Trade Union Centre, recommended ensuring the safety of workers’ lives at the workplace, improving industrial relations, and developing labour laws that meet global standards.

Iran projects 65k tons of cotton production by March 2025

POST BY
RMG Bangladesh
-

With a development in the agricultural sector, Iran expects to produce 65,000 tons of cotton by the end of the current Iranian calendar year, which concludes on March 20, 2025.

Figure: Iran’s textile industry requires 150,000 to 180,000 tons of cotton annually.

The announcement was made by Ebrahim Hezarjaribi, the Director of the Cotton Plan at the Ministry of Agriculture, in an exclusive interview with IRIB, the soleIranian public service broadcaster.

“Harvesting of cotton has started in the country since September, and we anticipate reaching our target by year-end,” Hezarjaribi stated.

Iran’s textile industry requires 150,000 to 180,000 tons of cotton annually, with domestic producers supplying about 40 to 50 percent of the demand. “The rest of the country’s needs are met through imports,” Hezarjaribi added.

This expected production represents a steady stride in reducing reliance on imports and bolstering local agriculture.

Experts see this as a vital step toward self-sufficiency in the textile sector, despite the challenges of meeting full market demand domestically.

Notably, efforts are ongoing to enhance cotton cultivation and efficiency, with government and industry leaders.

1...345...1,200Page 4 of 1,200

RMG BANGLADESH NEWS

RMG BANGLADESH
A Knowledge-based Initiative of Best Sourcing
Ready Made Garments sector is the key source of foreign currency and GDP for Bangladesh. Approximately 4.2 million people are dependent on the RMG sector for their bread and butter.
Contact us: info@rmgcentre.com
Facebook RSS Twitter Youtube

EVEN MORE NEWS

POPULAR CATEGORY

© Copyright 2019 - RMG Bangladesh