Problems in RMG sector and their solutions

9 September, 2018 12:00 AM printer

Problems in RMG sector and their solutions

Bangladesh has made tremendous progress after the expedite footsteps undertaken by Accord and Alliance in the RMG sector. As we are gaining the largest fruit of export earnings from this sector, the essence of factory level up-gradation is gaining importance day by day. So far, the progress made by Accord and Alliance is remarkable but the question arises up to which extent our national bodies can maintain this progressive status and when the two giant groups will leave our country.  It is a blessing that a large number of RMG factories are covered by Accord and Alliance and national bodies cover a smaller share. Despite the fact, now it is a matter of concern whether we are experienced enough to maintain this status quo of progress in near future?

Moreover, recent obligations of ILO to maintain workplace safety associated with sustaining compliance standards (fire, electrical and structural) put an extra burden, especially to the small factories. However, the recent violence from the workers’ side to ensure minimum wage will definitely raise the cost structure of RMG factories. Considering this present situation, the horrifying days are not so far when it will be difficult to operate this industry without applying the theory of merger and acquisition. Presently, factories somehow manage to operate business obeying all rules and regulations fixed up by Accord and Alliance, but we should not forget that to achieve the $50 billion target in the next three years equal participation of all RMG units need to be made sure.


Statistics shows that over the last 10 years Bangladesh maintainined a yearly average growth rate of 5 per cent and it requires yearly 13 per cent growth to achieve the $50 billion target by 2021. In this context the pressure of additional cost structure will definitely hamper the overall growth of this industry. It is high time now for political bodies and respective authorities to come forward and take some concrete steps for flourishing this sector and thereby to accelerate the economic growth of this country. The government should suggest the banking sector to allow loans with low interest rates so that factories can maintain the progress rate.

Besides, monitoring process of the national inspection bodies should be flexible to some extent depending on the location and factory size. RCC (Remediation Coordination Cell) formed by DIFE should arrange meeting time to time to check the regular status of the factories. National inspection bodies should be given special training as well as sufficient manpower so that they can regularly maintain up-gradation status of factories. Last but not the least, we have to remember that being a citizen of Bangladesh and for developing the country profile in the global arena factory owners should be more cautious for maintaining compliance standard of their factories. 


Faijan Bin Halim, a Researcher.