Garment manufacturers in Bangladesh are calling on the government to support the industry in its upcoming budget, with the provision of 5% cash incentives on exports for the next two years.
At a Bangladesh Garment Manufacturers and Exporters Association (BGMEA) press conference on 27 May, president Siddiqur Rahman said it would be difficult for the sector to remain competitive in the global marketplace without support.
He urged the government to withdraw tax at source for the next two years, reduce corporate tax to 10% for five years from the existing 20%, and ensure policy stability for investment.
Rahman said the ready-made garment (RMG) industry has been facing a number of challenges, including a fall in apparel prices, increases in production costs, and strong currency headwinds against the dollar, which have slowed down growth.
“Production costs have increased by 18% in the last two years while prices of apparel items exported by Bangladesh have fallen by 40% in the last 15 years,” he told journalists. “Besides, there is the huge pressure of remediation works in the factories. Against this backdrop, the RMG industry needs the support from the government to retain competitiveness in the global market.”
Some 18 Bangladesh garment factories were forced to close last week after a heatwave swept through the country and led hundreds of garment workers to collapse, according to local media reports.
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By GlobalDataThe reports say workers fell ill in the middle of their shifts and others fled from the facilities in panic. Nearly 500 workers were taken to hospital, although most were released after rehydration and first aid.
Heatwave hits workers in Bangladesh garment factories
