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Daily Newsletter

11 August 2023

Daily Newsletter

11 August 2023

BGMEA, Solidaridad sign MoU to achieve ESG vision by 2030

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has signed a memorandum of understanding (MoU) with NGO Solidaridad Network Asia with the aim of combining efforts to create a sustainable and green apparel sector.

Shemona Safaya August 10 2023

The collaboration aims to combine efforts on worker wellbeing and reskilling; enhancing productivity, building a digital platform for sustainability reporting as well as achieving ESG standards and international corporate due diligence, according to Bangladesh publication, Bangladesh Post.

The report adds the MoU will also contribute towards BGMEA fulfilling its Sustainable Strategic Vision: 2030.

The joint efforts are expected to focus on skilling and upskilling garment factory workers along with mid-level managers on the fourth industrial revolution, the green workplace and empowering women with supervisory skill development training.

Both organisations will promote an improved energy efficiency business model and as part of the partnership, Bangladesh Post reports BGMEA and Solidaridad will work on building knowledge and capacity for the execution of EU due diligence, particularly the Dutch and French derivatives on due diligence.

The newspaper also explains Solidaridad will support BGMEA with creating a digital data platform to maintain a log of reliable data from BGMEA member factories on ESG issues to improve transparency and real-time reporting.

Both organisations will also work together to prepare BGMEA's Sustainability Report of enlisted factories within an updated platform to ensure wider reach.

The newspaper explains BGMEA vice president Shahidullah Azim and country manager of Solidaridad Network Asia Selim Reza Hasan signed the MoU with Hasan stating: "The partnership between BGMEA and Solidaridad will make a significant stride for improving the sustainability norms and practices towards making the Bangladesh apparel industry more sustainable and inclusive."

The BGMEA and German development cooperation agency GIZ partnered on a project aimed at strengthening human rights and environmental due diligence in Bangladesh's RMG sector in March.

Value apparel has gained appeal amid high inflation

Per latest GlobalData estimates, the global value apparel market was valued at $228.8bn in 2022, exceeding pre-pandemic levels and outperforming the other apparel price positions. This was partly due to consumers trading down to more affordable brands as they faced inflationary pressures, but also due to the rapid rise of fast fashion player Shein, which has leapt into the market leading position. Between 2022 and 2027, the global value apparel market is forecast to achieve a CAGR of 3.2%. Gen Z is a key target audience for value apparel players, due to their usually limited disposable incomes and high purchasing frequencies as a result of wanting to follow rapidly changing trends meaning they often prefer cheaper brands. As fashion is of high importance to this demographic, they are also less likely to cut back on spending on clothing and footwear amid inflationary pressures. However, value players are under pressure to reduce their environmental footprints amid changing consumer perceptions and evolving regulations regarding sustainable business practices. Supply chain disruptions and higher production costs continued to impact value brands in 2022 due in part to the outbreak of the war in Ukraine and lasting COVID-19 restrictions in China, which is highly detrimental to value players due to their already thin profit margins and their low price business models.

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