Bangladesh and the

Garments Sector

Reason behind the crises

The garment industry of Bangladesh has been the key export division and a
main source of foreign exchange for the last 25 years. The industry provides
employment to about 3 million workers of whom 90% are women. This sector is
entirely export oriented and is composed of over 5000 units - most working for
international buyers, some owned by international companies. Most of the garment
units are clustered in industrial areas and Export Processing Zones (EPZs) in and
around Dhaka. In 1978 the Bangladesh government set up EPZs to attract foreign
capital and earn export dollars. In 1993 the Bangladesh Export Processing Zone
Authority (BEPZA) was set up and a blanket ban on trade union activity imposed.
The EPZs now employ 70,000 workers, mostly in the garment and shoe-making
industries (though most of the garment industry exists outside the EPZs). National
labour laws do not apply in the EPZs, leaving BEPZA in full control over
work conditions, wages and benefits. Garment factories in Bangladesh
provide employment to 40 percent of industrial workers. More than three-
quarters of the $7.8 billion of Bangladesh's export earnings comes from exporting
garments. Most of the garment workers have migrated from the poorest rural
areas into the city slums. The slum population of Dhaka has doubled in the last
10 years (up to 3.4 million in 2006 from only 1.5 million in 1996 following heavy
rural-urban migration). More than 90 per cent of the slum dwellers have income
below poverty line, which is Taka 5,000 (£ 37.00) a month per household. The
dwellers are mostly transport workers, day labourers, garment workers, small
vendors, informal traders and domestic helps. It is this wider community that
usually joins in the clashes and riots with the garment workers.
The global economy is controlled by the transfer of production, where firms in
developed countries turn their attention to developing countries. The new system is
centred on a core-periphery system of production, with a comparatively small
centre of permanent employees dealing with finance, research and development,
technological institution and modernisation and a periphery containing dependent
elements of production procedure. Reducing costs and increasing output are the
main causes for this arrangement. They have discovered that the simplest way to
cut costs is to move production to a country where labour charge and production
costs are lower. According to one report (see Editorial Section, New Age,
30/01/2008) the hourly wage in Bangladesh is $0.25 compared to $0.35 in
China, $0.60 in India, $0.40 in Indonesia, , $0.40 in Pakistan, $0.45 in Sri
 Lanka and $2.40 in Mexico.
The MFA was renewed on three occasions over the years and was finally phased
out on 1 January 2005. The MFA expired and Bangladeshi exporters were no
longer protected by the quotas restricting imports of textiles and clothing
from more competitive countries like China and India.
The end of the quota system led to the loss of 1 million jobs in Bangladesh’s
clothing industry. The Bangladeshi government itself estimated that at least
200,000 to 300,000 workers lost their jobs. Millions of jobs in related sectors of
activity, such as transportation, button making, information businesses, hotels,
financial services and property companies went into risk. USA’s imports of baby
clothes from China more than quadrupled in 2002, whilst those from
Bangladesh fell by 16%. Other types of clothes show similar trends: according to
the government, Bangladesh has lost 33% of its export markets for the 29
products removed from the quota system on 1 January 2002, mostly to the
benefit of China and Vietnam. Hundreds of garment factories were closed
between 2001 and 2003 following the drop in demand from the USA after the
attacks on September 11 2001. As the import of Chinese goods increased, the
USA also started to buy more clothes from Caribbean and sub-Saharan African
countries, which have recently been granted customs-free access to this market for
their clothes. At the same time, the USA has kept high taxes on clothes
imported from Bangladesh. In 2002, Bangladesh paid almost the same
amount in tax on its 2.4 billion dollars of clothes exports to the USA
(approximately 330 million dollars) as France for its 24 billion million dollars
of exports to the USA. The other major market for Bangladeshi exporters, the
European Union (EU), has scrapped import dues though only on a few clothes
containing a certain proportion of materials with the “made in Bangladesh” label.
Solely concerned with making profits, Bangladeshi garments employers are quick
to accept orders even when they know it will be very difficult to deliver them on
time. They put pressure on employees to do a lot of overtime. Given the low basic
wages, the workers are forced to agree to do this overtime. However the fatigue
that the latter produces adds to the existing bad health of many workers in this
sector and to a reduction in the quality of products and in the companies’
productivity. That has gone worse since the government has recently announced
that it would increase the amount of authorised overtime and reduce the
restrictions on women’s night work.
Trade Unions
The textile and clothing companies in Bangladesh are some of the most hostile
towards recognition of workers’ union rights. Out of 3,000 textile firms that
produce for the export market barely 127 have an officially registered union and
 less than a dozen employers have serious negotiations with unions. Workers are
frequently victims of sackings, beatings or false accusations by the police of
militancy within their unions. Workers who try to set up a union are not protected
before its registration and so are often subjected to harassment from their
employers, which sometimes assume a violent form with police support. The
names of workers asking to register a union are often passed on to employers, who
quickly try to transfer or sack them, above all in the textile sector. Even once a
union has been registered those workers suspected of activism are subjected to
frequent harassment. Majority of trade unions in Bangladesh have direct or
indirect links with local and foreign Non-Governmental Organisations (NGOs),
and receiving lucrative grants seem to be their main goal. Most of the trade unions
appear to be tools of main political parties, strikes being used more as vehicles for
pursuing political goals against rival parties rather than improving workers'
conditions.
Minimum wage for the workers is now Taka 950 (£7.00) a month that was
fixed around 12 years ago. Nearly all workers in the Bangladesh garment
industry work for little more than starvation wages, under conditions closer to
those endured by European workers 150-200 years ago. Physical and sexual abuse
in the workplace is common where most are girls as young as 12 years old. Over
time is often compulsory and wages are sometimes withheld for months. The
condition is worse outside the EPZs where 80% of the garments workers are
employed.
Exploitation
To stay in the international competition without any quota system in place,
the garment employers are sucking the blood out of the workers. The
minimum wage hasn’t improved for years and with no clear trade union
intervention regarding this matter, employers are exploiting workers at will. The
easiest way the system can extract surplus value is by prolonging the working
hours. This is a classic example of extracting absolute surplus value. In Capital
Vol 1, Marx mentions:
The prolongation of the working-day beyond the point at which the labourer would
have produced just an equivalent for the value of his labour-power, and the
appropriation of that surplus-labour by capital, this is production of absolute
surplus-value. It forms the general groundwork of the capitalist system…. (Karl
Marx, Vol 1, Part 5, chapter 16)
There is a limit in increasing the total working hours. It has serious impact on the
health of the workers, resulting in inefficiency. A study carried out in 2003 by a
Bangladeshi institute on over 800 textile workers discovered that 42% of
women workers and 24% of their male counterparts are suffering from
 chronic diseases (such as gastro-intestinal infections, urinary complaints,
blood pressure problems and anaemia, etc.). 45% of the women and 36% of the
men who were interviewed said they felt weak, whilst 3% of the women and 4% of
the men had fainted in the months prior to their interviews. Their weakened state is
causing major losses of productivity but has not encouraged the bosses to make
radical improvements to the situation
This is not the end of the plight of the workers. With huge job losses in the
garments sector women workers are the most vulnerable. It can be said that
trafficking of Bangladeshi girls to foreign countries could increase as the number
of jobs falls in the textile industry. The prospect of getting a job in this sector in
Dhaka or other major cities attracts tens of thousands of young women from rural
areas, who are determined not to return to their villages without having succeeded
in earning a lot of money. The traffickers are well aware that these young women
are in a very vulnerable position. In most cases these women have no idea of the
risk they run of ending up in foreign prostitution networks. The traffickers sell
these girls for around 100 to 400 US dollars. India, Pakistan and some Arab
countries are the main destinations for these smuggled girls.
Conclusion
Karl Marx wrote 120 years ago, “Capital is dead labour, that, vampire-like, only
lives by sucking living labour, and lives the more, the more labour it sucks.”
(Capital, Volume I, Chapter 10). Marx’s quote is an exact example of the
capital system in the garments sector. In Bangladesh the capital system is
worse than vampires. The crises in Bangladesh should also be examined from
a global perspective. Globalization yields bad results as seen from the garments
sector. In the case of Bangladesh it is clear that impediments to exports worsen the
financial stability of poor people. The evidence from the garments sector suggests
that relying on trade or foreign investment alone is not enough to improve the
condition of poor people of Bangladesh. The poor need education, improved
infrastructure, ability to relocate out of contracting sectors into expanding ones.
Apologists for capitalist globalization claim that they are bringing jobs and
economic development when they chase low wages throughout the developing
world. Instead it destroyed many rural based economies and agricultures, driving
millions off their land. This is a pattern repeated by all the so-called free trade
agreements.
Lenin made it clear in his “Imperialism: the Highest Stage of Capitalism,” that
imperialism is not a policy. It is a stage of capitalist development, an objective
process. The same is true of capitalist globalization. It is not a policy of this or that
government. It is an objective process of transnational capitalist development. This
distinction is important to understanding the class struggle today. Government
 policy can have impact on how capitalist globalization proceeds, as long as
capitalism is the dominant economic system, its globalization will continue.
The process of capitalist globalization is a very important context for
understanding the labour movement in the Bangladesh today. How did we get
here? Why such a steep decline in union membership in the last 25 years? These
are some of the questions we would like to follow in a later article.
Capitalist globalization has to be met with international labour solidarity. The
process of building global labour solidarity is an objective process of the class
struggle, just as capitalist globalization is an objective process. One clear
responsibility for progressive forces in labour is to make the connections and push
for greater and greater international ties and contact with workers of the world.

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