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The offices of the Bangladesh Garment Manufacturers and Exporters Association has a continual flow of people and Shahidullah Azim, its vice president, has six or seven chairs in his room, almost always all occupied. Yet he manages to get through everyone’s agendas, makes quick decisions and never minces words.
This story first appeared in the April 22, 2014 issue of WWD. Subscribe Today.
Right now he says that, “It’s moving along positively.”
Over the last year, the BGMEA has played the role of mediator, funds giver and been at the forefront of almost all the exchanges that have taken place throughout the country’s apparel industry. It is now setting the plan for the coming months, and it’s obvious that, like the factory owners who are its members, the organization is learning to live with the more open and changing environment.
Here, Azim talks about the changes that have taken place in the Bangladesh industry since the Rana Plaza disaster.
WWD: Factory owners have been called upon to accept many new things this year.
Shahidullah Azim: Yes, we struggled a lot and things have come out very, very positively. There have been so many initiatives taken for the Rana Plaza issue — the Accord and the Alliance have come in and everybody has been working hard. [So far] 675 factories have been inspected by the Accord and Alliance and out of these they have found only four buildings are vulnerable. There were 11 factories in four buildings and that’s not bad in percentage terms.
WWD: Yet, it takes a lot to change the mind-set of employers. How has this changed over the last year?
S.A.: The main thing is that manufacturers have changed their mind-set. They understand that they have to make changes in the way they function and are moving accordingly. Right now the compliance issue is being taken very seriously by everyone, so much so that new memberships are only issued if we find everything is OK in the buildings, make sure the construction is sound. If they are not, we deny membership and nonmembers are not allowed to export. Older members also are having to work with the same issues.
WWD: How are the factory inspections going so far?
S.A.: Right now the inspectors are checking all the factories with a lot of attention to detail. Of the 3,600 garment factories, 2,400 factories belong to the Accord and the Alliance and the remaining 1,200 are a part of the National Action Plan, which is inspected by BUET [Bangladesh University of Engineering and Technology] and under supervision of the International Labor Organization [ILO].
WWD: Over the last year, the BGMEA has been stretched to its limit, hasn’t it?
S.A.: The thing is that BGMEA takes a lot of in-house initiatives. We have recently appointed about 12 engineers and 35 trainers. So these are all new guys, after Rana Plaza. That’s why I say things are moving positively — the employers have been very sporting about the way they have taken this — and they know that we don’t have any other choice: We have to go for it and hold inspections and make changes in the factories, etc. Earlier it was a different mind-set.
WWD: What are the other main issues that are hard to resolve at this time?
S.A.: I believe that at this time the employers need some help. Now the Alliance is helping us — especially if the factory needs to shut down for repair; they will pay one month of salaries.
The issue of remediation continues to be worrying. There was a term in the accord agreement — article 22 of the agreement of the Accord — that the brands or retailers would pay us during remediation, but in fact we’re not getting their help.
WWD: What has been the main highlight of this year from your perspective?
S.A.: First of all, the labor bill was amended in parliament, wages increased and in terms of trade unions, there were only 38 [factories that had them] in the last decade and now over the last year, 150 factories have trade unions. There’s a lot that has been moving along very positively.
WWD: What about the government role in all of this. Was it lost during the elections?
S.A.: The government has taken it all very seriously. We are also working with the government for safety equipment as well as prefabricated materials to be brought in and more accessible in July. These are both important because 40 percent of our factories are in shared buildings and they have to go for relocation sooner or later. They cannot do it overnight, but they have to do it, so it should be taken as an important thing to consider before this budget is drawn.
WWD: Are you pleased by the way brands and retailers have been handling the situation?
S.A.: Well, if our factories are going to be shut down, they have to come forward and help us out. The brands and retailers — they are also gaining from this; they’re not doing charity. So if they’re our partners, we want to know they are partners all along. In this they must come forward. They’re not going to pull out their business from Bangladesh. In the long run, if they don’t support the factories, they will lose too. If brands don’t support the factory owners, the factory owners will also find other clients.
WWD: What would you have the retailers and brands do differently?
S.A.: In fact, we’re not satisfied. Because BGMEA works independently it doesn’t get that kind of support from the brands. Even after the wage increase, it’s not like the brands or retailers are increasing the product prices — there are very few who would do that. Very few. Meanwhile, we continue to be under pressure from brands across the world.
In the last four years, we have increased workers’ salaries 229 percent, yet it is doubtful that we would get that kind of support from them [brands and retailers].
WWD: Do you think it is realistic for them to increase prices when they want to stay competitive?
S.A.: When we ask them to increase the product prices, they say it is a free market economy market and that the buyers’ principal is that they will buy wherever they find it cheaper.
On the one hand, they tell us we would share our profit with our people, but on the other hand we are being forced to [do] certain things — they should not impose upon us. The workers are our people; we can share with them but we should not be forced.