In a confirmation that there will be changes in the way global brands and retailers work with factory owners in Bangladesh, the president of the powerful Bangladesh Garment Manufacturers and Exporters Association is quitting the board of the U.S. retailer-led Alliance for Bangladesh Worker Safety.
“Atiq Islam, president of the Bangladesh Garment Manufacturers and Exporters Association and the board of directors for the Alliance for Bangladesh Worker Safety (Alliance) came to a mutual agreement on his resignation from the Alliance board of directors,” Guillermo Meneses, an Alliance spokesman, told WWD on Wednesday.
The Alliance represents 26 brands and retailers including Wal-Mart Stores Inc., Target Corp., and Gap Inc. and was formed two years ago to ensure safety of workers in the garment industry in Bangladesh after the collapse of the eight-story Rana Plaza. The organization has been working closely with factory owners, who have often praised the retailers for their empathy and responsiveness to the industry in Bangladesh. Especially important has been the inclusion of the BGMEA on the board, giving a voice to the factory owners impacted by the changes in safety requirements.
But in recent weeks there have been growing tensions between the two groups of global retailers and brands — the Alliance and the Bangladesh Accord for Fire and Building Safety, which represents 200 global brands and buyers — and the local industry. A letter by the BGMEA president citing interference and criticism from the Bangladesh finance minister Abul Maal Abdul Muhith was followed by a strongly worded letter from Alliance chairperson Ellen Tauscher, asking the Bangladesh government to clarify its position.
Islam’s resignation from the Alliance board also comes at a time when the BGMEA leadership is scheduled for change, with elections scheduled for Sept. 8.
“Atiqul Islam will end his tenure as the president of BGMEA in the next few weeks,” said Meneses. “The Alliance wishes to thank him for his service and we wish him every success as he transitions from his current role in the BGMEA. We look forward to continuing to work with BGMEA, the government of Bangladesh and all stakeholders committed to ensuring the safety of garment factories and the empowerment of garment factory workers in Bangladesh.”
Acknowledging the change, BGMEA vice president Shahidullah Azim emphasized that the association was leaving the board but not the Alliance, and that the change was due to a conflict of interest at times.
“The president of BGMEA has had two entities — one as president and representative of 3,500 garment factories and the other as an Alliance board member — which sometime seems a conflict of interest since he is also answerable to factory members,” Azim said.
“But the Alliance and BGMEA goal is the same, to ensure work place safety; BGMEA has zero tolerance for dissent in this regard. We hope this change will not harm our relations — rather, we can work more close with Alliance initiatives for workplace safety in Bangladesh,” he said.
Noting the change, Prof. Mustafizur Rahman, executive director of the Centre for Policy Dialogue, which focuses on issues critical to the development process of Bangladesh, said that it was obvious that global retailers were concerned about the stance taken by the Bangladesh government and factory owners, and that local groups were working to defuse the situation.
“It is unclear whether it is a series of overreactions or misunderstandings as progress is undertaken in the garment industry with an objective of completing safety projects by 2018, after which the Bangladesh government is expected to continue the initiatives,” said Rahman.
He said this was particularly true as export targets were being followed closely in the country, where garment exports account for a major share of export earnings. The Export Promotion Bureau in Bangladesh said last week that exports in the 2014-15 fiscal year, which ended in June, rose 3.35 percent to $31.2 billion.
Garment exports continue to form the bulk of this, at $25.5 billion — an increase of 4.5 percent over the previous year.
“The results have been disappointing, well below the 10 percent growth target for this year,” said Rahman. “But with demand compression and a weaker euro, the growth has been lower than expected.”
However, exports to the U.S. have shown an increase in 2015.
In the period from January to May, apparel exports to the U.S. rose 7.1 percent from the previous year, totaling $2.32 billion.
“The retailers’ confidence in us has started to return as we are carrying out a lot of positive transformations in the garment sector after the Rana Plaza building collapse,” Islam noted.