Exporters urge buyers to pay more for future orders considering workers' living costs

Apparel exporters have appealed to brands and buyers to consider paying additional costs for forthcoming orders in view of rising living expenses of workers due to the high inflation across the world.

BGMEA President Faruque Hassan made the call in a letter, sent to all representatives of brands and buyers on Thursday, pointing out that the new wage board for workers is expected to be implemented by this December. He requested buyers to take this into account when placing upcoming orders, particularly for products scheduled to be produced from December onwards.

"Now, inflation and production cost hikes, including gas, electricity, fuel, transport, and other costs, are squeezing our breathing space. In fact, the workers, who are the lifeline of this industry, are suffering the most from the inflation," reads the letter.

Acknowledging that RMG product prices have increased to some extent, the BGMEA noted that these adjustments are barely sufficient to offset the rising costs.

"You may know that the minimum wage board for garment workers will review the current minimum wages," the BGMEA chief wrote, adding that the board has conducted several meetings and is presently engaging with various stakeholders. "They [the board members] are visiting factories and engaging in discussions with both workers and owners."

Faruque further said, "I believe before the end of this year a new minimum wage will be declared and there will be quite a significant increase, if we look at the trend of previous reviews, as well as the aggregate inflation in the past five years."

While requesting buyers to contemplate a reasonable price adjustment for forthcoming orders, the leader of the apex trade body emphasised that it is also important for a smoother transition to the new wage scale.

He also sought suggestions, advice, information or comments from different brands and buyers to make this industry more competitive, efficient and sustainable.

"As we commit ourselves to continuously delivering the better, we are leaving no stone unturned to optimise the value of our spending, with an uncompromising stance on ethical and responsible business," he added.

The first minimum wage board in the RMG sector in Bangladesh was formed in 1984 with Tk560 as minimum monthly wage. So far, the wages of workers in this sector have been revised six times. The latest minimum monthly wage is Tk8,000, which was effective from December 2018. According to the labour law, new wages have to be fixed every five years.

According to statistics for December 2021, Bangladesh has the lowest wage among the competitor countries – Pakistan, Sri Lanka, India, Myanmar, Cambodia, and Indonesia.

The government formed a new wage board for garment workers on 9 April 2023. The new wages are likely to be finalised by November and implemented in the following month.

Meanwhile, labour rights groups demanded offering workers a minimum monthly payment of Tk23,000.