Bangladesh’s readymade garment (RMG) businesses must shorten the lead time related to product shipment and opt for artificial fibres, according to industry experts and businesses, which recently told a webinar on the impact of the pandemic that the government should allow foreign direct investment in the sector to tackle post-COVID-19 challenges.
The concentration in products, material mix and markets together with lower market share in man-made fibre (MMF) are undermining the growth potential of the sector, they noted.
The France Bangladesh Chamber of Commerce and Industry and the Policy Research Institute (PRI) organised the webinar, according to Bangla media reports.
Bangladesh needs to shorten its lead time by developing its backward linkage industries as current dependency on imports for MMF and inefficient customs processing have contributed to much longer lead time, PRI executive director Ahsan H Mansur said.
“Investing heavily on from backward linkage integration to manufacturing of yarns and fabrics would be the central elements of post-COVID-19 recovery efforts,” he said.
Ahsan said that Bangladesh should strive for heavy investments in digitising the process and transforming value chains as the product development would become more flexible and agile to face the post-pandemic challenges.
Seeking investments from France, he said that it should be an issue for discussion to attract investments from French firms that are interested to leave China.
Kihak Sung, chairman of Youngone Corporation, said that the FDI was very important for the RMG sector in Bangladesh as foreign investments would bring new technology.
He said that the global companies who were interested to migrate from China were considering Vietnam due to equitable policy of the country.
Kihak said that they exported products worth $100 million to France a year but they lost 25 per cent of their business in the country in the last fiscal year due to the coronavirus pandemic.
Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association, said that Bangladeshi suppliers faced problems in France as two brands cancelled their orders fully and filed applications for bankruptcy.
Huq also proposed an unemployment fund to support the workers who would lose their jobs due to the pandemic.