Faruque Hassan is the newly named president of BGMEA, one of the largest trade associations representing the Bangladesh ready-made garment industry. Hassan, managing director at Giant Group, has also served as the president of the Dutch Bangla Chamber of Commerce and Industry (DBCCI) and will lead BGMEA through 2023.
He explained to us how he wants to support the Bangladesh garment industry so it becomes more sustainable–and successful.
How is the present situation of the Bangladesh Apparel Industry after the onset of the pandemic?
While the Ready Made Garment (RMG) industry of Bangladesh was trying to recover from the shock caused by the first wave of the pandemic, the second wave has marked its beginning. The waves have already crippled the Western world and since lockdown measures were taken to curb the infection in most of our export destinations, our RMG export is facing a continuous downward trend since early 2020. We have lost US$6 billion in export in fiscal year 2019-20 compared to the previous fiscal year, and during July-March of fiscal year 2020-21 the export earnings from RMG stood at US$23.49 billion which was US$25.95 billion during the same period of fiscal year 2018-19, indicating a 9.49% decline.
However, thanks to Bangladesh government support, garment factories were reopened since late April 2020, following strict health and safety protocols developed by BGMEA, Ministry of Health, Better Work Bangladesh of ILO and WHO.
The subsequent waves worsened the situation further as it hit retail business and demand for clothing, which eventually slowed down our exports. We have lost around 4% unit value during September 2020-March 2021, while the cost of operation has increased due to disruption in scale economy and empty capacity. Factories are also suffering from increased cost due to maintaining health protocols.
How is the industry reacting and evolving right now to avoid eventual similar difficult periods in the future?
The Covid-19 pandemic has introduced a “new normal” way of living life across the globe. Since the initial breakout of the virus, our industry has experienced an unprecedented situation.
Apart from health issues, secure business, protecting factories and employment are our immediate priorities. While we would be pursuing legal protection for challenged factories that suffered financially and non-payments, insolvency resolution is a need of the time when we are putting efforts. We are also in a spirit of maintaining collaborative relationships with the buyers so that we can continue the relationship of trust.
Moreover, we would also put efforts and resources to pursue innovation, efficiency improvement, diversification, modernization and digitalization of the industry, make it more resource efficient, and explore the potentials of a virtual marketplace. With achieving excellence in these areas, we are working to pave the path for future growth. We have taken an initiative to establish a center for innovation at BGMEA with the objective to train people on 3D technologies and efficiency enhancement to make the industry more resilient and sustainable.
How can the Bangladesh Apparel Industry act more sustainably?
Starting from elimination of child labor in 1995 we have faced so many ups and downs, and positioned ourselves as one of the most ethical manufacturing hubs. The high ethical manufacturing standard of Bangladeshi factories is well recognized by the brands and consumers globally today. A paradigm shift has happened in the area of workplace safety since 2013 through industry-buyers-governments-donors joint initiative. Today Bangladesh is home to the most LEED green factories. We have now 138 LEED green factories of which 35 are platinum rated. Thirty-nine of the global top 100 LEED green factories are in Bangladesh and around 500 factories are in the pipeline. So Bangladesh is showing its maximum commitment when it comes to sustainability. But sustainability is not a sprint–it’s a marathon so we are setting higher bars while we chase sustainability.
But above all we also need to make the industry financially sustainable, to stay in the business and be more productive. To this end BGMEA have initiated a “Center of Innovation and Efficiency” which envisages to provide training and support to the manufacturers in the area of enhanced productivity, digitalization and virtual sampling process, product development techniques, virtual prototyping, energy efficiency and audit, among others.
What projects and strategies will BGMEA focus on to increase Bangladesh’s ability to offer more responsibly made clothes in the future?
The global demand for sustainable product is increasing and clearly implying that a radical global shift toward more sustainable consumption and production pattern in the future is necessary. With the changed global business landscape, Bangladesh, being the second-largest apparel exporter [after China], has made notable efforts in the core areas of sustainability. However, to sustain its competitive position in the global market, we have to shift our focus on circular economy, the new future of the global fashion industry. A shift to circular economy would not only be important for “Race to Zero” by 10% in terms of GHGs emission reduction but also for aligning with the SDG-12 on “Responsible consumption and production” and achieving the overall SDGs (Sustainable Development Goals) and NPIs (Non Profit Institutions) of the Government of Bangladesh.
Carbon footprint reduction is another core area of global concern. An energy efficient and renewable energy sourced industry is a key strategy to produce lower carbon footprint products.
The “Green Button” initiative would assist in ensuring all aspects of sustainability of the apparel product, ranging from the preliminary stage of cutting-spinning-bleaching-dyeing to weaving, spinning and fiber production. On top of everything, sustainability reporting and SDGs alignment would encourage the Bangladesh Apparel Industry to further measure and manage its impacts on the SDGs and NPIs and produce more responsibly made clothes accordingly.
We have our solid commitments to implement Zero Discharge in the industry. We have already started a project with GFA (Global Fashion Agenda) funded by P4G named CFP (Circular Fashion Partnership), and the PaCT project being implemented in more than 250 factories partnering with IFC looking into cleaner production and renewable energy.
Our commitment is to take the RMG industry to the next level of sustainability and we are looking comprehensively to all the possible areas of concerns.