January 24, 2024
DHAKA – Business leaders in the apparel and textile sectors in Bangladesh yesterday demanded fair prices for their products sourced by international buyers, saying the country has made major gains in quality and compliance.
The leaders made the demands at a roundtable on “Due Diligence Laws”, organised by the International Business Forum of Bangladesh (IBFB) at its conference room in the capital.
In December, the European Parliament and Council negotiators agreed on new rules – referred to as Due Diligence Laws — obliging firms to integrate their human rights and environmental impact into their management systems.
The rule applies to EU and non-EU companies with a turnover over 150 million euros and smaller companies in sectors such as textiles, agriculture, mineral resources and construction.
It includes a civil liability regime for damages and penalties including naming and shaming and fines of up to no less than 5 percent of net worldwide turnover, according to the website of the European Parliament.
The agreed draft law requires formal approval from the European Parliament and the European Council before it can enter into force.
Yesterday, business leaders in the apparel and textile sectors alleged that international buyers consistently pay lower than the global average to suppliers in Bangladesh.
“Bangladesh seems to be the buyer’s market. Buyers always impose lower prices,” said Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association.
“We are deprived.”
He said the fair price should be included in the due diligence law. “Otherwise, everybody in the apparel industry, including workers, will suffer.”
He described all apparel brands and buyers as “blood suckers”.
Mohammad Ali Khokon, president of the Bangladesh Textile Mills Association, says manufacturers have to take certificates from various organisations in Europe and the United States to comply with rules.
“But we don’t get a fair price.”
“If we are to comply fully, you need to give us the strength to carry this heavy burden,” he said, calling on the buyers to raise prices.
Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association, echoed the same sentiment.
“No matter how much we talk about ensuring a level-playing field, today’s market is buyer-driven, and manufacturers have little to no scope to intervene in this setting,” he said.
“The goal we want to achieve by implementing the due diligence law is universal and desired by all.”
He said there has to be a mechanism to ensure a level-playing field, particularly for the supply chain partners downstream.
While making the keynote speech, Berned Spanier, deputy chief of the European Union to Bangladesh, said once the due diligence law is implemented, obligations will be enforceable in two ways.
First, victims can claim reparations from a company in a European court if they can show that the damages, they suffered were caused by the companies’ failure to follow due procedures.
Second, the EU’s national supervisory bodies will be able to sanction companies if they fail to implement diligence procedures.
Stakeholders, including trade unions or civil society organisations, will have to make claims within five years.
About the fair price, Spanier said pricing is a matter of negotiation between buyers and sellers.
“We can’t force anyone to do that.”
Charles Whitley, ambassador and head of delegation of the EU to Bangladesh, said Bangladesh is going to graduate from the group of least-developed countries to a developing nation by 2026.
“So, due diligence legislation shouldn’t be seen as an isolated thing.”
“The laws aren’t in the interest of buyers or sellers. It’s in the interest of everybody in the world so that we can tackle climate change, child labour, slavery, labour exploitation, pollution, deforestation, excessive water consumption, and damage to the ecosystem.”
“That’s not a European interest; it’s a global interest.”
At the roundtable, the business leaders also demanded a unified code of conduct and audit system from buyers. Whitley backed the proposal.
Humayun Rashid, president of the IBFB, MS Siddiqui, vice-president, and Muhammad Abdul Mazid, adviser, also spoke at the discussion.