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National ownership of exports

Published on 3rd Feb, Edition 5, 2014

 

“Now won’t you give some bread to get the starving fed? We’ve got to relieve Bangladesh. Relieve the people of Bangladesh. We’ve got to relieve Bangladesh.” On August 01, 1971, ex-Beatle George Harrison alongwith legendary Sitar maestro Ravi Shankar organized two Concerts for Bangladesh at the Madison Square Garden in New York City where Harrison sang for the first time his hymn titled Bangladesh. This lamentation galvanized the world and Bangladesh became a country that needed to be saved from impending disaster. A bloody civil war, the rise of a secessionist movement, the clarion call for Bengali nationalism, the whispers of conspiracies and plots, the rejection of the people’s mandate, and the emergence of a strong leader culminated in the emergence of Bangladesh on December 17, 1971.

Henry Kissinger, the erstwhile US Secretary of State, presided over a high-level meeting in early December 1971 in the State Department to discuss the situation in, then, East Pakistan. There were growing concerns about the possibility of a famine-like situation. It was in this meeting that, Ural Alexis Johnson, a Foreign Service official, made the infamous comment that the new nation would be an “international basket case”, a quote that has been wrongly attributed to Kissinger.

This stirring background forms the basis for the narrative of how a nation that chronically suffers from natural disasters, such as cyclones, that has a huge populace living in abject poverty, that faced famine and hunger, that is enmeshed in political turmoil and instability, that suffered military coups, tolerates unrestrained corruption, and copes with unrest among the people, surmounts all these negativities to emerge as a relatively successful nation by becoming the premier clothier to the world. The apparel exports are in excess of $20 billion and experts predict that Bangladesh, despite various roadblocks, would triple her exports figures by December 2020.

There must be some critical mass that has brought about this spectacular transformation from what Kissinger acerbically stated more than three decades ago that “Bangladesh is a bottomless basket” to the enviable position that Dhaka today has in the global textile marketplace. Bangladesh garment manufacturers were and are routinely chided for blatant employment of child labor, blamed for paying pathetically low wages and violating human rights and labor standards, and are accused of shamelessly disregarding workplace safety and health measures.

Bangladesh apparel manufacturers also suffer the ignominy of being callous with the lives of the workers. In the last seven or eight years, more than 2,200 workers have died in fire-related incidents in the garment industry. The eight-storey Rana Plaza, where factories were employing thousands collapsed on April 24, 2013 resulting in the death of 1,126 workers. Despite global condemnation from buyers, consumers and social activists, despite calls for boycott of Bangladeshi products, and despite vociferous demands for new safety standards, the fact remains that the importance of apparel from Bangladesh is still in vogue.

 

Garment tycoons are active in national politics and have a strong voice and influence in major political parties. This is a prime reason why Bangladesh garment industry has managed to keep wages low, has a lax attitude in assuring a decent workplace environment, and has been successful in thwarting all efforts to introduce legislation that would negatively impact on it. What is more astonishing is that major apparel importers and brands also neglect to take into account gross violations and disregard of human rights.

The carefully planned strategy of the Bangladesh entrepreneurs since the last more than three decades ensued into an inclusive growth in many sectors. The game plan was to take advantage of the prevailing universal sympathy for Bangladesh, especially in Europe and United States, and set up a labor-intensive industrial sector that provided immediate employment to the marginalized women and, in the beginning, even children. Today, four million workers toil day and night to clothe the Western world. 80 percent of garment workers are women and five million slum dwellers of Dhaka are a ready supply of labor, willing to stitch, sew and cut for a meager wage. The allure of cheap labor, the protection of the industry by the state apparatus, and the obvious vulnerabilities of the new entrepreneurs enabled major global brands and chains of stores to make Bangladesh their preferred choice. Moreover, the special consideration given to Bangladesh in the form of duty-free access by Europe and USA propelled the industry to grow exponentially.

The apparel sector is the mainstay of the export regime and everyone in the country adopted the industry as their own. Political parties, labor federations, business organizations, media and policymakers all endeavored to protect, promote, and project the country’s garment industry. This worked superbly for the manufacturers and they become a strong and potent force, often dictating the nation’s policies. Profits were fabulously high and more than 5,000 units were set up in cities, towns and even in agriculture fields. The quality of apparel was maintained at world class standards and lucrative linkages were globally established. The unwritten rule accepted by all was that export transports would not be blocked while protests and strikes would not affect production schedules or deliveries. This national ownership made the difference between Bangladesh and many regional countries.

Alas, a time comes when activism shakes up the status quo. This development happened after the Rana Plaza’s tragedy. The workers became violently agitated and demanded raising the basic emoluments from the despicably low of $40 per month to more than $100. Internationally, the major brands and department stores also faced a backlash from their customers and this compelled them to prescribe safety codes and measures for factories. The downside has been further compounded by a steep decline in profit margins. Although demand for Bangladesh products is remarkably rising, essentially due to shifting of American and European orders from China, the price of the average garment has fallen by 12-15% in the last some years.

A message that Pakistani exporters must comprehend is that Bangladesh would be distinctly preferred over Pakistani products. They should first and foremost endeavor to convince their compatriots that success lies in national ownership of strategic assets, be they nuclear, historical, or private sector. In the words of American spiritualist Dr Orison Swett Marden, “No employer today is independent of those about him. He cannot succeed alone, no matter how great his ability or capital. Business today is more than ever a question of cooperation.”

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