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Dr Khondaker Golam Moazzem on non-compliant garment firms

Published in The Financial Express on Wednesday, 06 January 2016

Alliance action against non-compliant garment firms kicks into full gear

Monira Munni

The North American retailers’ group has severed business ties with about two-dozen garment exporters in a latest crackdown on non-compliant factories.

The Alliance move came after European buyers-led Accord took similar action against eight local garment makers in three phases.

Experts and exporters, however, stressed the need for improving workplace safety without halting production for the sake of both entrepreneurs and workers.

They also pressed for digging out the actual reasons for their failure to comply with the requirements whether non-availability of fund or competitiveness are responsible for such failure.

The Alliance has published the names of 23 factories on its official website.

“The listed factories have been suspended from the Alliance compliant factory list because of their lack of progress in one or more Alliance programs, thereby failing to make progress in ensuring a safe working environment,” the Alliance said.

If suspended factories wish to reestablish participation in the Alliance process, they will need to undergo a new inspection at their own cost, it added.

The reasons of suspension included failure to comply with the review panel’s recommendations and respond CAP meetings and lack of adequate remediation progress, according to the website.

While talking to the FE, a section of the companies said currently they are not producing for the Alliance-signatory members, while some others claimed their units remain closed.

“The decision of the official review panel is still pending. How can I go for further remediation until the decision is made?” asked a Chittagong factory owner.

He said the Alliance’s suspension is damaging for his factory.

Faruque Hassan, senior vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said the Accord and the Alliance want the best things and apparel makers are working to meet their requirements.

“But this thing needs time and money. There is a lack of fund. The bank interest is so high and banks are reluctant to provide fund in this regard as they don’t bring quick profit,” he added.

The factories are struggling that are located either in shared or rented buildings, he said.

Khondaker Golam Moazzem, additional research director of Centre for Policy Dialogue (CPD), said “Closure of factories without correcting flaws is sad.  Allowing production to be continued is positive for both entrepreneurs and workers.”

All stakeholders should take ‘comprehensive steps’ to give the opportunity to be in production, he said, suggesting finding out the real reasons why they failed to comply.

“Those who can’t fix problem due to fund shortage should be supported by all, including Accord and Alliance,” he said.

For funds, he recommended the government lower bank interest rate.

It should be examined whether the firms can maintain their competitiveness after such investment for remediation, he said.

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