Bangladeshi RMG Sector
||This article appears to be written like an advertisement. (October 2010)|
The economy of Bangladesh is largely dependent on agriculture. However, in recent years, the Ready–Made Garments (RMG) sector has emerged as the biggest earner of foreign currency. The ready-made garment (RMG) sector has experienced an exponential growth since the 1980s. The sector contributes significantly to the GDP. It also provides employment to around 4.2 million Bangladeshis, mainly women from low income families which affects their social status.
In the 1950s, labor in the Western World became highly organized; forming trade unions. This and other changes provided workers greater rights including higher pay; which resulted in higher cost of production. Retailers started searching for places where the cost of production was cheaper. Developing economies like Hong Kong, Taiwan and South Korea presented themselves as good destinations for relocations because they had open economic policies and had non-unionized and highly disciplined labor force that could produce high quality products at much cheaper costs.
In order to control the level of imported RMG products from developing countries into developed countries, Multi Fibre Agreement (MFA) was made in 1974. The MFA agreement imposed an export rate 6 percent increase every year from a developing country to a developed country. It also allowed developed countries to impose quotas on countries that exported at a higher rate than the bilateral agreements. In the face of such restrictions, producers started searching for countries that were outside the umbrella of quotas and had cheap labor. This is when Bangladesh started receiving investment in the RMG sector. In the early 1980s, some Bangladeshis received free training from Korean Daewoo Company. After these workers came back to Bangladesh, many of them broke ties with the factory they were working for and started their own factories.
Facts and figures 
In the 1980s, there were only 50 factories employing only a few thousand people. Currently, there are 4490 manufacturing units. The RMG sector contributes around 76 percent to the total export earnings. In 2007 it earned $9.35 billion. This sector also contributes around 13 percent to the GDP, which was only around 3 percent in 1991. Of the estimated 4.2 million people employed in this sector, about 50 percent of them are women from rural areas. In 2000, the industry consisting of some 3000 factories employed directly more than 1.5 million workers of whom almost 80% were female. USA is the largest importer of Bangladeshi RMG products, followed by Germany, UK, France and other E.U countries.
Women in the garment industry 
Garment sector is the largest employer of women in Bangladesh. The garment sector has provided employment opportunities to women from the rural areas that previously did not have any opportunity to be part of the formal workforce. This has given women the chance to be financially independent and have a voice in the family because now they contribute financially.
However, the women workers are facing many problems. Most women come from low income families. Low wage of women workers and their compliance have enabled the industry to compete with the world market. Women are paid far less than men mainly due to their lack education. Women are reluctant to unionize because factory owners threaten to fire them. Even though trade unionization is banned inside the Export processing Zones (EPZ), the working environment is better than that of the majority of garment factories that operate outside the EPZs. But, pressure from buyers to abide by labor codes has enabled factories to maintain satisfactory working conditions.
In recent times, garment workers have protested against their low wages. The firsts protests broke out in 2006, and since then, there have been periodic protests by the workers. This has forced the government to increase minimum wages of workers.
Wages in the garment industry 
In 2013 Miller, Doug discussed wages "Towards Sustainable Labour Costing in UK Fashion Retail." Available at [or http://dx.doi.org/10.2139/ssrn.2212100]
The future 
The RMG sector is expected to grow despite the global financial crisis of 2009. As China is finding it challenging to make textile and foot wear items at cheap price, due to rising labor costs, many foreign investors, are coming to Bangladesh to take advantage of the low labor cost. Even now for the readymade garments most of the manufacture need to bring all the accessories from abroad, which is very costly. Now they are start using locally accessories minting the required quality. Zippers, buttons, labels, hooks, hangers, elastic bands, thread, backboards, butterfly pins, clips, collar stays, collarbones and cartons are the major garment accessories produced in Bangladesh. Many small and medium accessory industries have grown here over the years, particularly to meet high demand from low-end garment makers The accessory market is dominated by multinational companies operating in Bangladesh, because in majority cases, garment buyers prefer accessories from them over the locally available items, Now it is time for the Bangladeshi Merchandiser to introduce more local trims and trims manufacturer to buyer to show their expertise.
Five deadly incidents from November 2012 through May 2013 brought worker safety and labor violations in Bangladesh to world attention putting pressure on big global clothing brands such as Primark, Loblaw, Joe Fresh, Gap, Walmart, Nike, Tchibo, Calvin Klein and Tommy Hilfiger, and retailers to respond by using their economic weight to enact change. No factory owner has ever been prosecuted over the deaths of workers. Other major fires 1990 and 2012, resulting in hundreds of accidental deaths, include those at That's It Sportswear Limited and the fire at Tazreen Fashions Ltd. Spectrum Sweater Industries, Phoenix Garments, Smart Export Garments, Garib and Garib, Matrix Sweater, KTS Composite Textile Mills and Sun Knitting. major foreign buyers looking for outsourcing demand compliance-related norms and standards regarding a safe and healthy work environment which includes fire-fighting equipment, evacuation protocols and mechanisms and appropriate installation of machines in the whole supply-chain. RMG insiders in Bangladesh complain about the pressure to comply and argue that RMG factory owners are hampered by a shortage of space in their rental units. In spite of this the industry exports totaled $19 billion in 2011-2012. They expected export earnings to increase to $23 billion in 2012-2013. 
Two dozen factory owners are also Members of Parliament in Bangladesh.
Scott Nova of the Worker Rights Consortium, a rights advocacy group, claimed that auditors, some of whom were paid by the factories they inspect, sometimes investigated workers right issues such as hours or child labour but did not properly inspect factories’ structural soundness or fire safety violations. Nova argued that the cost of compliance to safety standards in all 5,000 clothing factories in Bangladesh is about $3 billion (2013).
In 2000 garment entrepreneurs had a reputation for shirking custom duties, evading corporate taxes, remaining absent in capital markets, avoiding social projects such as education, healthcare, and disaster relief but, argued authors Quddus and Salim, these entrepreneurs took the risks needed to build the industry. Bangladesh successfully competes in the manufacturing industry by maintaining "lowest labor costs in the world." Garment workers' minimum wage was set at roughly $37 a month in 2012 but since 2010 Bangladesh's double-digit inflation with no corresponding rise in minimum wage and labor rights, has led to protests.
A fire broke out on 24 November 2012, in the Tazreen Fashion factory in Dhaka killing 117 people and injuring 200. It was the deadliest factory fire in the history of Bangladesh. According to the New York Times, Walmart played a significant role in blocking reforms to have retailers pay more for apparel in order to help Bangladesh factories improve safety standards. Walmart director of ethical sourcing, Sridevi Kalavakolanu, asserted that the company would not agree to pay the higher cost, as such improvements in electrical and fire safety in the 4,500 factories would be a "very extensive and costly modification" and that "it is not financially feasible for the brands to make such investments."
On April 24 910 textile workers factories making clothes for Western brands, were killed when a garment factory collapsed. The Savar building collapse was in the Rana Plaza complex, in Savar, an industrial corner 20 miles northwest of Dhaka, the capital of Bangladesh. It was the "world's deadliest industrial accident since the Bhopal disaster in India in 1984. While some 2,500 were rescued from the rubble including many who were injured, the total number of those missing remained unknown weeks later. The eight-story building, owned by Sohel Rana, associated with the ruling Awami League, was constructed on a "pond filled with sand". It only had planning approval for five floors. Owners used "shoddy building materials, including substandard rods, bricks and cement, and did not obtaining the necessary clearances." An engineer raised safety concerns after noticing cracks in the Rana Plaza complex the day before its collapse. In spite of this factories stayed open to fill overdue orders. When generators were restarted after a power blackout the building caved in. Six garment factories also in Rana Plaze were cleared to re-open on May 9, 2013 after inspectors allegedly issued safety certificates. Nine people were arrested including four factory owners, the owner of the complex and the engineer who warned of the crack in the building.
Immediately following the April 24 deadly industrial accident, Mahbub Ahmed, the top civil servant in Bangladesh's Commerce Ministry, fearing the loss of contracts that represent 60 per cent of their textile industry exports, pleaded with the EU to not take tough, punitive measures or "impose any harsh trade conditions" on Bangladesh to "improve worker safety standards" that would hurt the "economically crucial textile industry" and lead to the the loss of millions of jobs.
On May 9, 2013 eight people were killed when a fire broke out at a textile factory in an eleven-story building in the Mirpur industrial district owned by Tung Hai Group, a large garment exporter. Mohammad Atiqul Islam, president of the politically powerful textile industry lobby group, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told Reuters that "the Bangladeshi managing director of the company and a senior police officer were among the dead."
One of the solutions central to the safety issue may be worker empowerment; at Rana Plaza where the biggest disaster took place, the workers were forced to work, despite imminent collapse reported on TV news the previous day. One of the ways to empower workers may be by following Toyota Production System in manufacturing.
See also 
- Multi Fibre Agreement
- Bangladesh textile industry
- Accessories made in Bangladesh
- Child labor in Bangladesh
- List of companies of Bangladesh
- Next Eleven
- 3G (countries)
- Bangladesh textile industry
- Economy of Bangladesh
- Bazlul Khondhker, Abdur Razzaque, and Nazneen Ahmed (PDF). Exports, Employment and Working Conditions: Emerging Issues in the Post – MFARMG Industry.” (Report). http://training.itcilo.org/decentwork/StaffConf2005/resources/session%20VI/S6%20Bazlul-Issue-Paper.pdf.
- Kabeer, Naila; Mahmud, Simeen (29 July 2004) (PDF). Rags, Riches and Women Workers: Export-oriented Garment Manufacturing in Bangladesh (Report). Women in Informal Employment: Globalizing and Organizing (WIEGO). http://wiego.org/sites/wiego.org/files/publications/files/Kabeer-Mahmud-Export-Oriented-Garment-Bangladesh.pdf.
- [dead link] “Bangladesh’s RMG Export Performance.
-  Naila Kabeer and Simeen Mahmud. “Rags, Riches and Women Workers: Export – oriented Garment Manufacturing in Bangladesh.”
- "BGMEA Upbeat on Export Growth". Bizbangladesh.com. Retrieved 2010-10-05.
- * Fauzia Ahmed. “The Rise of the Bangladesh Garment Industry: Globalization, Women Workers, and Voice.”
- *[dead link] “Garment Workers in Bangladesh.”
-  Garment Workers Revolt in Bangladesh.
- [dead link] BGMEA RMG Export Statistics
- "Avoiding the fire next time". The Economist. 4 May 2013.
- Paul, Ruma; Quadir, Serajul (4 May 2013). "Bangladesh urges no harsh EU measures over factory deaths". Dhaka: Reuters.
- Nur, Shah Alam (1 May 2013). "Space shortages at rented houses make RMG units non-compliant". Bangladesh: Financial Express.
- Quddus, Munir; Rashid, Salim (2000). Entrepreneurs and Economic Development: The Remarkable Story of Garment Exports from Bangladesh. Dhaka: The University Press Limited.
- Yardley, Jim (23 August 2012). "Made in Bangladesh: Export Powerhouse Feels Pangs of Labor Strife". Ishwardi, Bangladesh.
- Ethirajan Anbarasan (25 November 2012). "Dhaka Bangladesh clothes factory fire kills more than 100". BBC. Archived from the original on 25 November 2012. Retrieved 25 November 2012.
- Farid Ahmed (25 November 2012). "At least 117 killed in fire at Bangladeshi clothing factory". CNN. Archived from the original on 25 November 2012. Retrieved 25 November 2012.
- Anis Ahmed and Ruma Paul (25 November 2012). "Bangladesh's worst-ever factory blaze kills over 100". Reuters. Archived from the original on 25 November 2012. Retrieved 25 November 2012.
- Greenhouse, Steven (5 December 2012). Documents Indicate Walmart Blocked Safety Push in Bangladesh. The New York Times. Retrieved April 27, 2013.
- Quadir, Serajul; Paul, Ruma (9 May 2013). "Bangladesh factory fire kills 8; collapse toll tops 900". Dhaka: Reuters.
- Damien Gayle (30 April 2013). "Bangladesh factory death toll could reach 1,400: Primark says it will compensate families of killed and injured".
- "Disaster in Bangladesh: Rags in the ruins: A tragedy shows the need for a radical improvement of building standards". Dhaka, Bangladesh and Savar, Bangladesh: The Economist. 4 May 2013.