Overview of Bangladesh apparel industry
Overview of Bangladesh apparel industry
২২ আগস্ট ২০২০ ৩:০৭ অপরাহ্ণ
Agriculture, because the case in India, has been the backbone of the economy and chief source of income for the people of Bangladesh, the country made from villages. The government wants to decrease poverty by getting the highest productivity from agriculture and achieve self-reliance in food production. aside from agriculture, the country is far concerned about the expansion of export division. Bangladesh has accelerated and altered her exports substantially from time to time. After Bangladesh came into being, jute and tea were the foremost export-oriented industries. But with the continual perils of flood, failing jute fibre prices and a substantial decline in world demand, the role of the jute sector to the country's economy has deteriorated (Spinanger, 1986). then, the focus has been shifted to the function of the production sector, especially in the apparel industry.
The apparel industry of Bangladesh has been the key export division and the main source of exchange for the last 25 years. at present, the country generates about $5 billion worth of products annually by exporting garment. The industry provides employment to about 3 million workers of whom 90% are women. Two non-market elements have performed an important function in confirming the garment industry's continual success; these elements are (a) quotas under Multi- Fibre Arrangement1 (MFA) within the North American market and (b) special market entry to European markets. the entire procedure is strongly related to the trend of the relocation of production.
Displacement of Production within the apparel industry
The global economy is now controlled by the transfer of production where firms of developed countries swing their attention to developing countries. The new representation is centred on a core-periphery system of production, with a relatively small centre of permanent employees handling finance, research and development, technological institution and modernisation and a periphery containing dependent elements of the production procedure. Reducing costs and increasing output are the most causes of this disposition. they need to be discovered that the only thanks to undercharging are to manoeuvre production to a rustic where labour charge and production costs are lower. Since developing nations provide areas that don't impose costs like environmental degeneration, this practice protects the developed countries against the problems of environment and law. The transfer of production to 3rd World has helped the expansion of the economy of those nations and also speed up the economy of the developed nations.
The garment industry is controlled by the transfer of production. The globalisation of garment production started earlier and has expanded quite that of the other factory. the businesses have transferred their blue-collar production activities from high-wage areas to low-cost manufacturing regions in industrialising countries. The enhancement of the communication system and networking has played a key role during this development. Export-oriented manufacturing has brought some good returns to the industrialising nations of Asia and Latin America since the 1960s. the primary relocation of garment manufacturing happened from North America and Western Europe to Japan within the 1950s and therefore the early 1960s. But during 1965 and 1983, Japan changed its attention to more lucrative products like cars, stereos and computers and thus, 400,000 workers were dismissed by the Japanese textile and clothing industry. In impact, the second stock transfer of garment manufacturing was from Japan to the Asian Tigers - South Korea, Taiwan, Hong Kong and Singapore in the 1970s. But the tendency of transfer of producing didn't remain there. the increase in labour charge and activeness of trade unions were in proportion to the enhancement in economies of the Asian Tigers. The industry witnessed a 3rd transfer of producing from the 1980s to 1990s; from the Asian Tigers to other developing countries - Philippines, Malaysia, Thailand, Indonesia and China especially. The 1990s are led by the ultimate group of exporters including Bangladesh, Srilanka, Pakistan and Vietnam. But China was a leader within the current of the relocation as in but ten years (after the 1980s) China emerged out of thin air to become the world's major manufacturer and exporter of clothing.
Bangladesh Garment Sector and Global Chain
The explanation for this transfer is often clarified by the salary structure within the apparel industry, everywhere the planet. Apparel labour charge per hour (wages and fringe benefits, US$) in the USA is 10.12 but it's only 0.30 in Bangladesh. This difference accelerated the planet apparel exports from $3 billion in 1965, with developing nations making up just 14 per cent of the entire, to $119 billion in 1991, with developing nations contributing 59 per cent. In 1991 the number of workers within the ready-made apparel industry of Bangladesh was 582,000 and it grew up to 1,404,000 in 1998. In the USA, however, 1991-figure showed 1,106.0 thousand workers within the apparel sector and in 1998 it turned right down to 765. 8 thousand.
The presented information reveals that the tendency of low labour charges is that the key reason for the transfer of garment manufacturing in Bangladesh. The practice initiated in the late 1970s when the Asian Tiger nations were in quest of tactics to avoid the export quotas of Western countries. The garment units of Bangladesh are mainly counting on the 'tiger' nations for raw materials. Mediators in Asian Tiger nations build an intermediary between the textile units in their home countries, where the spinning and weaving continue, and therefore the Bangladeshi units where the material is cut, sewn, ironed and packed into cartons for export. equivalent representatives of tiger nations discover the marketplace for Bangladesh in several nations of the North. Large retail trading companies placed within us and Western Europe give most orders for Bangladeshi garment products. Companies like Marks and Spencers (UK) and C&A (the Netherlands) control capital funds, in proportion to which the capital of Bangladeshi owners is patience. Shirts manufactured in Bangladesh are sold in developed nations for five to 10 times their imported price.
The collaboration of native private apparel industry, Desh Company, with a Korean company, Daewoo is a crucial instance of international garment chain that works together of the grounds of the expansion of apparel industry in Bangladesh. Daewoo Corporation of South Korea, as a part of its global policies, took interest in Bangladesh when the Chairman, Kim Woo-Choong, offered an aspiring venture to the govt of Bangladesh, including the expansion and process of the tyre, leather goods, and cement and garment factories. The Desh-Daewoo alliance was decisive in terms of stepping into the worldwide apparel markets at a significant juncture when import reforming was happening during this market following the signing of MFA in 1974. Daewoo, a South Korean leading exporter of clothes, was in search of opportunities in nations, which had hardly used their quotas. thanks to the quota restriction for Korea after MFA, the export of Daewoo became limited. Bangladesh as an LDC got the prospect to export with none constraint and for this cause, Daewoo was concerned with the utilization of Bangladesh for his or her market. the aim behind this need was that Bangladesh would believe Daewoo for importing raw materials and at an equivalent time, Daewoo would get the market in Bangladesh. When the Chairman of Daewoo displayed an interest in Bangladesh, the country's President put him in-tuned with the chairman of Desh Company, an ex-civil servant who was seeking more entrepreneurial pursuits.
To fulfil this wish, Daewoo signed a collaboration contract with Desh Garment for five years. The contract also incorporated the fields of technical training, purchase of machinery and fabric, plant establishment and marketing reciprocally for a selected marketing commission on all exports by Desh during the contract phase. Daewoo also imparted an exhaustive practical training of Desh employees within the working atmosphere of a multinational company. Daewoo keenly helped Desh in buying machinery and fabrics. Some technicians of Daewoo arrived in Bangladesh to determine the plant for Desh. the top results of the association of Desh-Daewoo were important. within the first six years of its business, i.e. 1980/81-86/87, Desh export value increased at an annual average rate of 90%, reaching quite $5 million in 1986/87.
It is claimed that the Desh-Daewoo alliance may be a significant element for the expansion and achievement of Bangladesh's entire garment export industry. After getting linked with Daewoo's brand names and marketing network, overseas buyers went on with buying garments from the corporation heedless of their origin. Out of the opening trainees most left Desh Company at several times to erect their own competing garment companies, worked as how of moving knowledge during the entire garment sector.