Despite a recent series of catastrophic setbacks, the Bangladesh garment industry continues to outperform all of its rivals with the exception of China. With an impressive 16.3 percent increase in exports in the month of June, Bangladesh’s revenue tally for the year has hit $2.7 billion.
Bangladesh’s success is a powerful sign of its garment industry’s resilience. After the Rana Plaza collapse last April which claimed 1,127 lives, the nation has come under intense international scrutiny for inadequate factory safety standards and poor working conditions. A consortium of private companies have demanded immediate improvements. The EU has officially requested new labor laws and safety standards be passed during the current session of parliament. Also, the US has suspended its coveted GSP status.
But Bangladesh remains an attractive business partner for Western nations due to a combination of low wages and duty free access to Western markets. A member of the WTO since 1995, Bangladesh benefits from the EU’s “Everything But Arms” arrangement, which allows it duty free access for all exports, excluding arms and ammunition. And while the US has suspended duty free access for Bangladesh until it improves factory safety, this has little effect on the garment industry since it only applies to goods like golf equipment, kitchen appliances, and ceramics. Bangladesh’s garment industry has never qualified for duty free access to the US market.
For the fiscal year that concluded in June 2013, Bangladesh’s garment exports reached $21.5 billion, a 13 percent jump for the previous year, according to Bangladesh’s Export Promotion Bureau.