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Bangladesh Factory Owners Fear Excessive Minimum Wage Hike

Garment factory owners in Bangladesh are seeking a minimum wage increase for workers that is commensurate with the rate of inflation, but doesn’t exceed 20 percent.

They requested the wage raise at a specially convened meeting of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) held last week at its Dhaka office.

The current minimum wage for garment workers in Bangladesh is Taka 3,000 ($39) per month after it went up by more than 80 percent in 2010. With the proposed rate increase, the new monthly minimum wage would be Taka 8,000 ($102).

Mahtab Uddin Ahmed Chowdhury, managing director of knitwear manufacturer, Falcon Group, told the Dhaka Tribune that if the wage hikes irrationally, it would make the garment industry unstable.

Production costs have increased with newly implemented fire and building safety compliance following the Rana Plaza building collapse and owners fear a wage increase of more than 20 percent would cause their factories to suffer.

The meeting discussed securing a fixed minimum wage rate–a task being undertaken by the Minimum Wage Board–and BGMEA President Atiqul Islam said the association would consider owners’ demands to cap the wage increase, according to the Dhaka Tribune.