1. GLOBAL TRENDS IN THE GARMENT SECTOR AND OPPORTUNITIES FOR BANGLADESH:
THE DUET OF SUSTAINABILITY & COMPETITIVENESS
Faruque Hassan, Senior Vice President, BGMEA
CONFERENCE ON SUSTAINABLE SOURCING IN THE GARMENT SECTOR
Dhaka, 29 September, 2016

2. INTRO
Dynamics of global sourcing has been evolving with the changes in global trade and tariffs, realities, rules and policies.
The emerging sourcing opportunities are creating opportunities for all –
Entrepreneurs
Workers
Buyers
Consumers
Bangladesh being the second largest apparel sourcing country and a leader in sustainable and responsible business has immense potentials to further grow its market share.

3. 1978
1985
1995
2005
2010
2013
2016
2021
TIMELINE
RMG industry started its journey with $10000 exports made by 1200 workers
Export reached $116 million
0.12 million workers and 384 factories
Export hit $2.2 billion
Eliminated Child Labor through Earn & Learn program
Rise of purpose built compliant factories
Export $6.4 billion
MFA Quota phased out which was predicted to have severe consequence
Export $12.5 billion
Ranked 2nd largest RMG exporting country despite global recession
Export $21.52 billion
Rana Plaza & Tazreen accidents erupted the issue of workplace safety
Export $28 billion
10-years of MFA phase out. Export quadrupled, employment 4.4 mil.
Major progress in safety & workers rights
Vision has been set at $50 billion exports
Workplace safety, environmental sustainability, & excellence in product & market diversification envisioned

4. WORLD CLOTHING TRADE 2015 IN BILLION US DOLLAR

5. EMERGING GLOBAL TEXTILE & CLOTHING HUB
ASIA
EMERGING GLOBAL TEXTILE & CLOTHING HUB
Share of Asia and rest of the world (ROW)
in global clothing exports, measured in US$ ?

6. Y-O-Y EXPORT GROWTH% OF MAJOR CLOTHING SUPPLYING COUNTRIES, MEASURED IN US$

7. APPAREL EXPORT OF BANGLADESH VALUES IN BILLION US$, FY1985-FY2016
Last 10 years compound annual growth rate (CAGR) is 12.43%

8. SNAPSHOT: TEXTILE & CLOTHING INDUSTRY IN BANGLADESH
Number of Clothing
Factories
3800 around
4.4
Million workers
Investment
$11
billion
around
394 spinning &
777 textile mills
99% accessories
made locally
Exports to
around 130
countries
Export
$28
billion

9. MAJOR MARKETS OF BANGLADESH’S APPAREL

10. Versatility & Adaptability
WHY BANGLADESH
STRENGTHS
35 years experience
Price
Quality
Workforce
Safe & Compliant
Transparent
Green
Commitment
Market Access
Versatility & Adaptability
Backward Linkage

11. SAFER PRODUCTION IN BANGLADESH
Remediation completed by 70% ACCORD suppliers and 63% of ALLIANCE suppliers
Fit for Operation:
98.94%
Inspected factories:
3746
(100%)

12. WORLD’S TOP RATED LEED CERTIFIED INDUSTRIAL ESTABLISHMENTS ARE IN BANGLADESH
GLOBAL AWARD WINNER GREEN LANDSCAPING APPAREL FACTORY AT DHAKA
A PLATINUM LEED CERTIFIED
WOVEN FACTORY AT DHAKA
33 LEED certified factories
150 more factories in LEED certification pipeline
World’s highest rated knitwear, woven, washing and Denim mills
A PLATINUM LEED CERTIFIED
WASHING FACTORY AT DHAKA

13. BANGLADESH IS BLESSED WITH HUMAN RESOURCES
70% of the population is under 40 yrs old
Large educated and motivated youth
High literacy rate (72%) among youths aged 15-24
Inspired young, hungry for work and growth
2 million youth entering in job market each year
Labor cost advantage
117 million mobile phone users
33% internet penetration

14. THE NICHE PROJECT
Within the Niche project "CSR & SRHR in the RMG sector in Bangladesh", funded by the Ministry of Foreign Affairs, an international consortium and the BGMEA University for Fashion & Technology (BUFT) is working to improve vocational training on CSR & SRHR in the textile sector in Bangladesh.
Part of the project is the establishment of a Centre of Excellence (CoE) which will offer research, training and consultancy services to the textile sector in Bangladesh. The CoE will be operational in 2017.
The CoE will mainly respond to the changing (market) demand for Dutch buyers because of the textile covenant, the sustainable procurement policy of the government and the transition trajectories  by CSR Netherlands.
It involves, for example, the increasing demand for circular fabrics and mass customization.
BUFT and the CoE will provide the industry in Bangladesh soon the opportunity to get familiar with these new trends and developments and how circular garment concepts in Bangladesh can take shape.
A well-functioning technical university as BUFT is indispensable to maintain the Bangladesh textile industry modern and competitive in a rapidly changing world.

15. MARKET ACCESS FOR BANGLADESH
EU (28) GSP: Duty free access for apparel on 1-stage Rules of Origin.
Japan GSP: Duty free access for apparel on 1-stage Rules of Origin.
Canada GSP: Canada provides Zero duty access on 25% value addition requirement
Switzerland GSP: Duty free access for apparel on 1-stage Rules of Origin.
Norway GSP: Duty free access for apparel on 1-stage Rules of Origin.
Australia & New Zealand GSP: Australia & New Zealand provides Zero duty access on 25% value addition requirement (subject to additional 25% sourcing from GSP beneficiary countries)
China Duty Free: China provides Zero duty access for 60% items under global initiative through WTO, this will be enhanced to 97% products.
India: Zero duty access to all apparel items under SAFTA.
Chile: Duty free access for apparel.
Malaysia, Thailand & South Korea: Provide duty free access to a number of apparel items from Bangladesh.

16. OUR PRIORITIES Product & Market Diversification
OPPORTUNITIES
Product & Market Diversification
Technology & Efficiency Enhancement
Developing Professionals & Skills

17. BANGLADESH IS GETTING READY
100 Special Economic Zones in next 15 years
Enhancing electricity supply to 20,000 MW from 13280MW at present
LNG terminals being set up to meet demand for gas
Mega projects on rail, road, sea and airports going on
The Padma bridge will open a new horizon of opportunities
Focused drive on Cleaner Production
PADMA BRIDGE – connecting people to prosperity

18. BANGLADESH ECONOMY STANDING STRONG
July2008-June2009
July2015-June2016
GDP Growth
5.74%
7.05%
Manufacturing
Growth
6.68%
10.30%
Export
$15.57 billion
$34 billion
Import
$22.51 billion
$40.03 billion
Private Investment
as % of GDP
19.67%
21.78%
FDI Inflow (In US$)
$960.50
Million
 $2.24 billion
Per Capita GNI (US$)
$676
$1466
Poverty rate
40%
22.4%
Remittance
$9.69 billion
$14.93 billion
Foreign Exchange reserve
$30.14
Billion
Inflation
8.7%
5.92%
Bangladesh has become the Lower Middle Income Country from an LDC based on GNI performance
Vision to graduate to a Middle Income Country by 2021
Becoming a Developed Country by 2041

19. COLLABORATION MODEL FOR WIN-WIN-WIN
Responsible Production & Supply Chain
Happy Workforce
Ethical
Sourcing & Fair Price

20. WELFARE ACTIVITIES
BGMEA has been providing Grievance Management facilities to the garment workers at free of cost since The Committee is headed by a retired District Judge and participated by workers and owners representatives.
BGMEA is providing regular training programs on worker-management relations and Bangladesh Labor Act for both factory management and workers. Already 1072 workers and mid-level management staffs have been trained.
BGMEA has opened a Trade Union Advisory cell having an ex-Joint Director of Labor as its head.
The BEF, BGMEA and BKMEA with the support of ILO (ITC) has trained 114 senior master trainers. These master trainers will train 8,000 mid-management officials and 8,00,000 workers gradually by end of Such programs should be continued and expanded to build the capacity of the industry to facilitate harmonious industrial relations.
12 Health Centers for the workers; serves more than 60,000 patients per year

21. WELFARE ACTIVITIES
BGMEA is constructing two full-fledged Hospitals for the workers, one 100 bedded in Chittagong (part of it came in to operation already) and another 150 bedded in Dhaka
Awareness raising for prevention of HIV/AIDS, Tuberculosis, reproductive health and the use of contraceptive devices
BGMEA in collaboration with the Govt. runs several Skills Training Centers in different areas of the country.
BGMEA runs Five Schools for the workers’ children and provides books & study materials at free of cost.
The BGMEA University of Fashion & Technology (BUFT)
BGMEA jointly with the Government of Bangladesh has taken initiative to establish Dormitories in Chittagong and Ashulia
BGMEA organizes musical talent hunt program GORBO

22. SUSTAINABILITY People Planet Profit
BGMEA runs awareness program on regular basis to motivate the entrepreneurs in adopting energy efficient technologies, machines and work process
In order to institutionalize the process, BGMEA has set up an Environment Cell
“Partnership for Cleaner Textile - PaCT” between BGMEA, the Government of the Netherlands IFC and a number of apparel buyers
Toward Resource Efficiency & Environmental Sustainability (TREES) with GIZ to build capacity of relatively smaller factories on environmental best practices.
People
Planet
Profit

23. Thank You !