Garment Industry in Bangladesh: Global Competitiveness Drives Need for Alternatives

By Amy Chang

The ready-made garment (RMG) industry has been the main contributor to transformative growth in Bangladesh in the last four decades, but in more recent years it has drawn international attention for its poor working conditions. In 2013, collapse of the Rana Plaza building in the capital city of Dhaka killed 1,130 people, putting Bangladesh in the international spotlight for labor reform. The response to this incident, however, has been largely PR-based and failed to create long-term change. In many ways this is unsurprising, as unfortunately international retailers are faced with increasing global competitiveness, creating difficulty in pushing for higher standards and regulation.

As exploitative as the current situation can be, the industry has created jobs for millions and produced extraordinary economic activity in a once poverty-ridden country. Since the arrival of RMGs in the 1970s, the poverty rate in Bangladesh has fallen from 70 percent to 40 percent. Clothing manufacturing accounts for almost 80 percent of exports and generates more than $20 billion in revenue annually. Apart from creating employment for more than four million people, the RMG industry has also made great strides in empowering women financially. In the industry, 90 percent of workers are female; unlike many developing countries where women can still obtain a role in the agricultural sector, women in Bangladesh typically do not work outside the home. The arrival of RMGs has changed this and spurred an exodus of poor rural women into cities to become crucial financial providers for their families, and prevented many young Bangladeshi women from marrying underage.

RMG

A worker spins yarn onto bobbins in the Wooltex Sweaters Limited factory in Shewrapara, Dhaka. In 2008, the Asian Development Bank loaned $50 million to the Bangladesh Ministry of Education to improve the skills of millions of workers in the ready-made garments and textiles, light engineering, and construction industries. Photo courtesy of the Asian Development Bank.

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