The sustainability and competitiveness of RMG industry may be hampered due to rising production cost, driven by hike in wage, energy and compliance cost and declining international market price.
Speakers came up with the comment at a seminar titled ‘DCCI Conclave on Sustainability of Readymade Garments (RMG) Sector in Bangladesh’ held at Dhaka Chamber of Commerce and Industry (DCCI) auditorium.
They also said the lowest price offering to Bangladeshi products reduces the profit margin of entrepreneurs and urged for reducing cost of doing business in this sector and for image building.
They also stressed skill development. If gas price hikes it will increase the cost of production as well. They also sought at least five-year incentives and support from the government.
The speakers also termed the depreciation of taka against the dollar as one of the reasons for price fall of RMG industry. But trust between buyers and producers are important, observed the speakers.
Commerce Minister Tipu Munshi, MP, was present there as the chief guest with DCCI President Osama Taseer in the chair. Dr Rubana Huq, President of BGMEA, was present as special guest.
The commerce minister agreed that the RMG industry needs some incentives for a certain period in order to support it.
He also said that the entrepreneurs of this sector are not getting right price from the buyers. He urged for increasing negotiation skill to get the best price from the buyers. He said our factories are now more compliant and the qualities of our products are also high.
He said government will be with the RMG sector as it is the biggest contributor in our economy. He informed that FTA with Sri Lanka, Belarus and Czechoslovakia are in final stage and government is thinking of signing FTA with Brazil also.
The Commerce Minister said that gas and energy price hike will increase cost of doing business in the RMG industry.
DCCI President Osama Taseer said that RMG sector shares USD460 million of total FDI to Bangladesh.
“We are the largest exporter after China constituting 6.5% of the world market of USD446 billion”, he said.
BGMEA President Dr. Rubana Huq said for the sustainability we need support from the government. Moreover we are in crisis of positive image and we should build this image in the international market with the support of all specially through the media.
She also underscored the importance of forming strong strategy, right statistics and also the government should focus on how to reduce cost of doing business for RMG's sustainability. '
