the readymade garment industry in bangladesh: …...readymade garment & textile industry in...

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Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING IN THE GARMENT SECTOR Dhaka, 29 September, 2016 GLOBAL TRENDS IN THE GARMENT SECTOR AND OPPORTUNITIES FOR BANGLADESH: THE DUET OF SUSTAINABILITY & COMPETITIVENESS

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Page 1: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Readymade Garment & Textile Industry in Bangladesh

Faruque Hassan, Senior Vice President, BGMEA

CONFERENCE ON SUSTAINABLE SOURCING IN THE GARMENT SECTORDhaka, 29 September, 2016

GLOBAL TRENDS IN THE GARMENT SECTOR AND

OPPORTUNITIES FOR BANGLADESH:

THE DUET OF SUSTAINABILITY & COMPETITIVENESS

Page 2: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

445

175

26 22 18 15 7 6 60

50

100

150

200

250

300

350

400

450

500

Wor

ld

Chin

a

Bang

lade

sh

Viet

Nam

Indi

a

Turk

ey

Indo

nesia

Cam

bodi

a

USA

WORLD CLOTHING TRADE 2015IN BILLION US DOLLAR

Page 3: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

ASIA, 40.92%

ROW, 59.08%

2000

ASIA, 62.41%

ROW, 37.59%

2015 2025

?

ASIA EMERGING GLOBAL TEXTILE & CLOTHING HUB

Share of Asia and rest of the world (ROW) in global clothing exports, measured in US$

Page 4: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Y-O-Y EXPORT GROWTH% OF MAJOR CLOTHING SUPPLYING COUNTRIES, MEASURED IN US$

-60.00%

-40.00%

-20.00%

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

140.00%

Wor

ld

Chin

a

EU (2

8)

Bang

lade

sh

Hon

g Ko

ng

Viet

Nam

Indi

a

Turk

ey

Indo

nesi

a

USA

Cam

bodi

a

Paki

stan

2015

2014

2013

2012

2011

2010

2009

2008

Page 5: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

0.12 0.62 2.

23 4.35 6.

42

12.5

0 17.9

1

19.0

9

21.5

2 24.4

9

25.4

9

28.0

90.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

1984

-85

1989

-90

1994

-95

1999

-00

2004

-05

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

Last 10 years compound annual growth rate (CAGR) is 12.43%

APPAREL EXPORT OF BANGLADESH VALUES IN BILLION US$, FY1985-FY2016

Page 6: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Export volume

1.53 billion

pieces

Number of Clothing Factories

3200 around

Export

$28billion

Exports to

around 130countries

4.4 Million workers

Investment

$10 billionaround 394 spinning &

777 textile mills

99% accessories made locally

SNAPSHOT: TEXTILE & CLOTHING INDUSTRY IN BANGLADESH

Page 7: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

• 1430 textile mills are in operation• capacity of yarn production 2100 million kg• capacity of fabrics production is 2800 million meters• 85% of knitted fabrics demand met locally• Huge potential in non-cotton items• Opportunities for Foreign Investments in textile sector

PRIMARY TEXTILE SECTOR IN BANGLADESH

Page 8: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

STRENGTHS

35 years experience

Price

Quality

Workforce

Safe

Green

Commitment

Market Access

Versatility

Backward Linkage

WHY BANGLADESH

Page 9: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Remediation completed by 63% ACCORD suppliers

and 57% of ALLIANCE suppliers

Fit for Operation:

98.96%

Inspected factories:

3746(100%)

SAFER PRODUCTION IN BANGLADESH

Page 10: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

A PLATINUM LEED CERTIFIED WASHING FACTORY AT DHAKA

A PLATINUM LEED CERTIFIED WOVEN FACTORY AT DHAKA

GLOBAL AWARD WINNER GREEN LANDSCAPING APPAREL FACTORY AT DHAKA

150 more factories in

LEED certification

pipeline

World’s highest rated knitwear,

woven, washing and Denim mills

33 LEED certified factories

WORLD’S TOP RATED LEED CERTIFIED INDUSTRIAL ESTABLISHMENTS ARE IN BANGLADESH

Page 11: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

• 70% of the population is under 40 yrs old

• Large educated and motivated youth

• High literacy rate (72%) among youths aged 15-24

• Inspired young, hungry for work and growth

• 2 million youth entering in job market each year

• Labor cost advantage• 117 million mobile phone users• 33% internet penetration

BANGLADESH IS BLESSED WITH HUMAN RESOURCES

Page 12: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

EU (28) GSP: Duty free access for apparel on 1-stage Rules of Origin.

Japan GSP: Duty free access for apparel on 1-stage Rules of Origin.

Canada GSP: Canada provides Zero duty access on 25% value addition requirement

Switzerland GSP: Duty free access for apparel on 1-stage Rules of Origin.

Norway GSP: Duty free access for apparel on 1-stage Rules of Origin.

Australia & New Zealand GSP: Australia & New Zealand provides Zero duty access on 25% value addition requirement (subject to additional 25% sourcing from GSP beneficiary countries)

China Duty Free: China provides Zero duty access for 60% items under global initiative through WTO, this will be enhanced to 97% products.

India: Zero duty access to all apparel items under SAFTA.

Chile: Duty free access for apparel.

Malaysia, Thailand & South Korea: Provide duty free access to a number of apparel items from Bangladesh.

MARKET ACCESS FOR BANGLADESH

Page 13: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

OPPORTUNITIES

Product & Market

Diversification

Technology & Efficiency

Enhancement

Developing Professionals

& Skills

OUR PRIORITIES

Page 14: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

BANGLADESH IS GETTING READY

100 Special Economic Zones in next 15 years

Enhancing electricity supply to 20,000 MW from 13280MW at present

LNG terminals being set up to meet demand for gas

Mega projects on rail, road, sea and airports going on

The Padma bridge will open a new horizon of opportunities

Focused drive on Cleaner Production

PADMA BRIDGE – connecting people to prosperity

Page 15: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

FY 2009 FY2016

GDP Growth 5.74% 7.05%Manufacturing Growth 6.68% 10.30%

Export $15.57 billion $34 billion

Import $22.51 billion$42.92 billion*Provisional

Private Investment as % of GDP 19.67% 21.78%

FDI Inflow (In US$)$960.50Million $2.24 billion

Per Capita GNI (US$) $676 $1466

Poverty rate 40% 22.4%

Remittance $9.69 billion $14.93 billion

Foreign Exchange reserve $15.57 billion$30.14Billion

Inflation 8.7% 5.92%

Bangladesh has become the Lower Middle Income Country from an LDC based on GNI performance

Vision to graduate to a Middle Income Country by 2021Becoming a Developed Country by 2041

BANGLADESH ECONOMY STANDING STRONG

Page 16: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Responsible Production

Happy Workfoce

Ethical Sourcing

COLLABORATION MODEL FOR WIN-WIN-WIN

Page 17: The Readymade Garment Industry in Bangladesh: …...Readymade Garment & Textile Industry in Bangladesh Faruque Hassan, Senior Vice President, BGMEA CONFERENCE ON SUSTAINABLE SOURCING

Thank You !