Nov 052013

“Review minimum wage or face shutdown”

garments- wage

Dhaka, Nov 5 :  Readymade garment (RMG) manufacturers and exporters of Bangladesh on Tuesday threatened to shut down all the factories in the country if the minimum wage board for the workers in the sector does not review its recommendation of the minimum wage at Tk 5,300.

At a press conference at BGMEA Bhaban, leaders of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) also sought the government’s intervention to settle the dispute over the workers wage.

The wage board at its 9th meeting on Monday decided to fix the new minimum wages at Tk 5,300 through voting of the board members. However, two board members representing the owners’ side at the meeting refrained from voting.

Addressing the press conference, BGMEA president M Akiqul Islam said the wage board at its 9th meeting refuted the owners’ proposal for fixing the wage at Tk 4,300 and recommended Tk 5,300 without the consent of the owners’. “We’ll appeal to the wage board for a review in a day or two,” he said.

“We’ve had a meeting with the members of BGMEA and BKMEA today (Tuesday). None of them have accepted it. They said they’ll give up and called for an exit plan instead.”

They’re ready to accept an exit plan right now, and that must be without any provision to pay termination benefits or taking the responsibility for the liabilities, he added.

Atiqul said about 70 percent without of the RMG units are small and medium enterprises and can not afford to be in the business if the minimum wages are fixed at Tk 5,300. “We’ll never accept it if the minimum wage crosses Tk 4,300,” he said.

“All the factories in the country will be shut down if the decision is not reviewed by the wage board by 15 days,” he added.

Asked whether the owners will accept it if the government intervenes and proposes a figure between 4,500 and 5,300, Akiqul said, “Time will say. Our demand is to fix it at Tk 4,500.”

Asked whether he considers Tk 4,500 minimum wage to workers to be human, he said, “There’s no question of humanity here. Wages are fixed mathematically and scientifically.”

“We simply won’t accept any wage above Tk 4,500. And the workers have options. They can become Chatal workers (rice mill workers) or leather workers if they wish.”

BKMEA president AKM Salim Osman said none of the owners in his association are interested to accept the recommendation of the wages board.

“We are providing jobs to those who were once housemaids…to those who had no skills. We’re leaving our machines at their care. We’re taking risks on the capital,” he said, “Where from 40 lakh workers were born. Let us do it in our own way.”

Jun 262013

bangladesh-Gas-reserveDhaka, 25 June 2013: Bangladesh risks running out of existing recoverable gas reserves within the next decade if no new gas fields are discovered, experts warn.

“Bangladesh urgently requires the necessary exploration and drilling to increase overall natural gas output,” local energy expert Nurul Islam told Platts Monday.

Data from state-owned Bangladesh Oil, Gas & Mineral Corp., known as Petrobangla, shows the country’s natural gas output is about 2.28 billion cubic feet a day against a demand of 2.7- to 3 Bcf per day.

Amid annual estimated demand growth of 10 percent, the country’s entire recoverable gas reserves of 16.36 trillion cubic feet are on course to dry up by 2022, Platts reported.

But if the natural gas consumption rate should exceed that 10 percent growth estimate, Bangladesh’s reserves won’t last more than a decade, a senior Petrobangla official said.

Of Bangladesh’s 20 producing gas fields, 15 are state-owned and the remaining operated by international oil companies.

Chevron now contributes more than half of Bangladesh’s total gas production.

An editorial in Dhaka’s Financial Express earlier this month noted the country’s policymakers and “so-called hydrocarbon experts” had portrayed a rosy picture that “Bangladesh was, as if, floating on gas.”

Instead, the editorial stated, the current “availability of gas is far short of the domestic demand for it.”

It said the scarcity of gas has created “multifarious” economic problems, with new industries not being able to start operation and existing ones operating at less than capacity.

In 2011, Petrobangla had forecast by this month it would be able to nearly double Bangladesh’s gas supplies and by December 2015 gas supplies would be further boosted, to exceed the country’s demand.

But Petrobangla last week revised downward the country’s natural gas output projection.

Bangladesh’s natural gas output increased only by 110 million cubic feet per day to 2.26 billion cubic feet per day until June 2013 from 2.15 Bcf per day in June 2012, Petrobangla data indicated.

“We could not increase natural gas supply from the state-owned gas fields in line with our initial target, resulting in less than expected natural gas output,” a Petrobangla official said.

He cited setbacks, including Chevron’s delay until 2014 of its plan to increase gas supplies from a previous target of 2013 and Russia’s Gazprom not able to meet its December 2013 target to complete a 10-well drilling program, the Financial Express reports. The country’s ambition to import liquified natural gas by December 2013 also has stalled because a bidder had not been selected to build a floating LNG terminal.


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Jun 252013

Bangladesh Building CollapseWashington, Tue Jun 25, 2013: Nine US senators on Tuesday urged President Barack Obama to suspend trade benefits for Bangladesh until the country where 1,129 people died in an April garment factory collapse improved its working conditions, reports Reuters.

“We urge that the administration suspend Bangladesh’s eligibility for GSP (Generalized System of Preferences), and establish a roadmap and timeline for reinstatement based upon tangible improvements in worker safety and related labor law reforms,” the group of Democratic senators said.

Obama is expected to decide by the end of June whether to suspend Bangladesh from the GSP program, which waives US import duties on thousands of goods from poor countries to spur economic development.

Suspending Bangladesh from the program would be mostly symbolic since the Asian nation’s main export, clothing, is not eligible for GSP tariff cuts, in deference to the US textile and apparel industry.

But it would be another blow to the country’s reputation in the wake of the collapse in April of the Rana Plaza commercial building, which housed a number of garment factories, and the Tazreen factory fire in November that killed 112 people.

Last year, the GSP program spared Bangladesh about $2 million in duties on $35 million worth of tents, golf equipment, plates and other items it exported to the United States, said Ed Gresser, a trade analyst with the GlobalWorks Foundation.

Bangladesh paid $732 million in duties on $4.9 billion worth of clothing exports to the United States, he said.

The AFL-CIO, the largest US labor organization, first filed a petition to suspend Bangladesh from the GSP in 2007.

The US government has put off that decision for six years, hoping the threat would be enough to encourage Bangladesh to make labor reforms.

US trade officials emphasized that suspending trade benefits was seen as “the last resort” while expressing frustration that Bangladesh had made little progress addressing longstanding US concerns over its labor conditions.

“President Obama must do everything in his power to prevent tragedies like the Bangladesh factory collapse from happening again,” Senator Sherrod Brown, an Ohio Democrat said in a statement with the other senators.

Earlier this month, an AFL-CIO official said she expected Obama would decide to suspend the benefits.

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Jun 202013

Dhaka, 20 June 2013: Bangladesh has made a significant progress in reducing poor people by 16 million in 10 years from 2000-2010 despite the series of external shocks affecting the country in 2007 and 2008.

The country witnessed a steady and continuous decline in the number of poor people over the decade – from nearly 63 million in 2000 to 47 million in 2010.

Despite a growing population, the number of poor people declined by 26 percent in 10 years. Poverty declined by 1.7 percentage points per year.

This was revealed at a new World Bank report ‘Bangladesh Poverty Assessment: Assessing a Decade of Progress in Reducing Poverty, 2000-2010’ launched on Thursday. poverty-in-bangladesh

The report said that during the period 2000-2010, poverty reduction was closely linked to the growth in labour income and changes in demographics.

The report findings said labour income, both formal and informal, was the dominant factor in higher incomes and lower poverty rates. Fertility rates have been steadily dropping over the last several decades which have resulted in lower dependency ratios and more income per-capita.

“The second half of the 2000s saw an escalation of real rural wages but the growth of urban real wages was lackluster,” it said.

Finance Minister AMA Muhith spoke on the occasion as the chief guest while Food Minister Dr M Abdur Razzaque as special guest. General Economics Division (GED) member of the Planning Commission Dr Shamsul Alam and executive chairman of the Power and Participation Research Centre Dr Hossain Zillur Rahman spoke as discussants.

World Bank Country Director Johannes Zutt made both the welcome address and concluding remarks while World Bank senior economists and co-authors of the report Dr Dean Jolliffe and Dr Iffath Sharif made a power-point presentation on the report.

Food Minister Dr M Abdur Razzaque said the country is very much on track of attaining almost all the MDG goals and the government has been staging a revolution on eradication of poverty as it declined by 1.7 percentage points per year. He also urged the development partners to support the government’s priority efforts to this end.

Dr Hossain Zillur pointed out one key challenge—nutrition—that the country would face in the next five years or a decade as almost 41 percent of the country’s children are stunted although not all of them are poor.

He also underscored the need for giving special emphasis on high-value non-crop sector like dairy and fishery to meet the challenge of nutrition.

On dropout aspect in education sector, the former caretaker government adviser said the country is off-track on primary education although a huge amount of money is spent there.

Noting that there has been dramatic improvement in addressing monga, Dr Zillur said there is a need to focus also on coastal and haor areas in the next decade.

GED member of the Planning Commission Dr Shamsul Alam said population planning should focus more on human resource development rather than controlling population.

World Bank country director Johannes Zutt said that against the odds, Bangladesh lifted 16 million people out of poverty in the last 10 years and also reduced inequality; that is a rare and remarkable achievement.

“Bangladesh now needs to help a growing population of young adults to obtain the skills and education needed to find productive works and participate fully in Bangladesh’s social and political life,” he said adding, “The World Bank remains committed to working with the government to help all Bangladeshis escape poverty and share in the country’s growing prosperity.”

The poverty assessment report showed that the living conditions of the poor also improved in the first decade of 2000. Between 2000 and 2005, a large number of households saw an improvement in terms of the materials used in the constructions of their homes and access to services.

Between 2005 and 2010, while the poor continued to improve the quality of their homes, the largest improvements for all households were in terms of the amenities households owned such as television sets and cellular phones.

While overall improvement in wellbeing can seen across all regions, poverty continues to be a daunting problem with about 47 million people still living in poverty and 26 million people in extreme poverty. Poverty in rural areas continues to be more pervasive and extreme than in urban areas, whereas urban areas remain relatively more unequal.

From 2000 to 2005, the East (Chittagong, Dhaka and Sylhet) was rapidly improving, while the West (Barisal, Khulna and Rajshahi) had been lagging behind. The poverty pattern changed in the next five years. Between 2005 and 2010, Western divisions experienced larger reductions in poverty and also managed to reach levels of poverty that are closer to those of their Eastern counterparts.

A growing number of women in the labour force contributed to poverty reduction, but further increasing their participation remains a challenge. The labour force participation rate of women, though increased from 25 percent to about 35 percent over the decade, still remains low by international standards.

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Jun 202013

Bangladeshi vegetablesDhaka, 20 June 2013: The Ministry of Commerce of Bangladesh will soon ban the export of green chilli, eggplant, cucumber and coriander-leaves to ensure the smooth supply of these essentials in the market during the holy month of Ramadan, reports UNB.

“Yes, we’ve decided to impose a restriction. The order will come seven days ahead of Ramadan,” Commerce Secretary Mahbub Ahmed told UNB over phone on Thursday.

The restriction may continue for at least a month as the demand for these essentials goes up during Ramadan, Commerce Ministry sources said adding that the government imposes such restriction each year before Ramadan.

Earlier in the day, the Parliamentary Standing Committee on the Commerce Ministry recommended the ban for keeping the Ramadan market stable.

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Jun 162013

Dhaka, June 16, 2013:  Bangladesh exported goods worth $35million or 0.72 percent of the total to the USA under its Generalized System of Preference (GSP) programme, commerce minister GM Quader told the country’s parliament on Sunday.

“As per the statistics of United States International Trade Commission (USITC) programme the Bangladesh’s total amount of export to the USA was $4,878million in 2012.

Of the items, goods worth $35million was exported to the USA under the Generalized System of Preference (GSP) facility,” Quader said replying to a tabled question of treasury bench member Nurul Islam B.Sc.

The US government has been threatening to cancel the facility in an apparent bid to sensitize Bangladesh in labor issues.

US President Barack Obama could soon decide to cut off trade benefits for Bangladesh, in a largely symbolic response to tragedies in Bangladesh’s garment sector that have cost more than 1,200 lives in the past eight months, it is reported.

The US Trade Representative’s office, with input from other government agencies, is completing its recommendations in preparation for a White House announcement by June 30.

Even though the trade benefits affect less than 1% of Bangladeshi exports to the United States, the Bangladeshi government has pleaded with the Obama administration not to be cut off.

The AFL-CIO, the largest US labour organisation, first filed a petition to suspend Bangladesh from the US Generalised System of Preferences programme in 2007.

The US government has put off that decision for six years, hoping the threat would be enough to encourage Bangladesh to make long-needed labour reforms.

But after the Tazreen factory fire in November that killed 112 people and the Rana Plaza building collapse in April that killed 1,129 more, it seems likely that Obama will eliminate or reduce the trade benefits, Celeste Drake, the AFL-CIO’s lead on trade issues, told Reuters this week.

The past year has been so horrendous that unless the United States acts the labour provisions of the GSP program will be seen as meaningless, she said.

The GSP programme is aimed at helping create jobs in poor countries by waiving US duties on thousands of goods.

Bangladesh has been in the programme since it began in 1976. But its main export, clothing, is not eligible for GSP tariff cuts, in deference to the US textile and apparel industry, which employed some 2.4 million workers four decades ago compared to less than 300,000 now.

Mother of a garments worker wailing as she could not identify her daughter from the mutilated bodies piled at a makeshift morgue in Dhaka on May 9, two weeks after the 'Rana Plaza' building collapse in Savar.

Mother of a garments worker wailing as she could not identify her daughter from the mutilated bodies piled at a makeshift morgue in Dhaka on May 9, two weeks after the ‘Rana Plaza’ building collapse in Savar.

Last year, the GSP programme spared Bangladesh about $2 million in duties on $35 million worth of tents, golf equipment, plates and other items it exported to the United States, said Ed Gresser, a trade analyst with the GlobalWorks Foundation.

But Bangladesh paid about $732 million in duties on $4.9 billion worth of clothing to the United States. That is almost twice as much as the $383 million in US tariffs collected on $41 billion worth of French goods in 2012, Gresser said.

In the past, some lawmakers have proposed changing the GSP programme to provide duty-free benefits for clothing from Bangladesh and Cambodia, but US textile manufacturers lobbied to prevent action on the legislation.

At least 13 countries have lost some or all of their GSP benefits since workers rights protections were added to the eligibility criteria in the 1980s. Most have been reinstated after making progress on the concerns.

While Bangladeshi clothing manufacturers would not be directly affected by a decision to suspend the GSP programme, Drake said she expected other Bangladeshi companies hit with increased duties to join the international community in lobbying the government for labour reforms.

“It’s a small stick, which is perhaps right, given that it is a developing country. Nobody wants to do something that would be an earthquake to their economy,” Drake said.

Sanchita Saxena, associate director of the Center for South Asia Studies at the University of California at Berkeley, said revoking Bangladesh’s GSP benefits would not help workers in Bangladesh’s garment industry.

“If the US wants to help improve conditions, international brands and international NGOs can help in building capacity to monitor the thousands of factories that need monitoring and help to enforce some of the laws that are in the books,” she said.

US retailers should also sign an agreement embraced by European retailers to improve safety conditions in Bangladesh’s garment industry, Saxena said.

New RMG Markets

To another question from treasury bench member M Abdul Latif, the Bangladesh Commerce Minister informed the House that the government had taken measures to create new markets of readymade garments (RMG) abroad.

He hoped that the country’s new export policy (2012-2015) would bring qualitative change in export trade and ensure a competitive edge in the risky world trade.

He said adding the government took part in nine international trade fairs organized by Export Promotion Bureau (EPB) in the fiscal year 2011-12 aimed at expanding the RMG markets worldwide.

Quader said steps have also been taken to take part in the international trade fairs in Russia, South Africa, Japan, Brazil, China, India, South Korea and send delegations there to explore market.

Initiatives have been taken to expand business among the SAARC countries and reduce trade imbalance under the agreement on South Asian Free Trade Area (SAFTA), he added.

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