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Concerted efforts needed for transition to circularity: BGMEA President
Circular economy presents a clear pathway toward achieving greater environmental sustainability while fostering economic growth, said Faruque Hassan, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
He said, “The readymade garment industry has historically followed a linear business model. However, it is evident that this trajectory needs to change if we are to ensure sustainability.”
“In Bangladesh, we have an opportunity to lead this change, to become not just an industry but a nation committed to circular practices,” he added.
Faruque Hassan made the observations while delivering his speech as guest of honour at the SWITCH to Circular Economy Value Chains (SWITCH2CE) Project inception seminar organized by UNIDO and the Ministry of Commerce in Dhaka.
Textile and Jute Minister Golam Dastagir Gazi (BirPratik) was present at the event as chief guest.
Global trade finance gap expands to 2.5 trillion USD in 2022: ADB
The global trade finance gap grew to a record 2.5 trillion U.S dollars in 2022 from 1.7 trillion dollars two years earlier, as rising interest rates, flagging economic prospects, inflation, and geopolitical volatility reduced the capacity of banks to deliver trade financing, according to the 2023 Trade Finance Gaps, Growth and Jobs Survey released by the Asian Development Bank (ADB) on Tuesday.
The trade finance gap is the difference between requests and approvals for financing to support imports and exports.
Read: Exports robust, August earnings rise to $4.78 billion
According to the survey, rebounding strongly after the COVID-19 pandemic, global goods exports grew in 2021 and 2022 at 26.6 percent and 11.5 percent, respectively. Demand for trade finance surged on the back of this sharp recovery, but heightened economic risks made finance more difficult to secure than before, the survey shows.
“The global trade finance funding gap has now widened to well over $2 trillion, as the global economy still struggles to rebound from the pandemic,” said ADB's Director General for Private Sector Operations Suzanne Gaboury. “That growing gap strangles the potential of trade to deliver critical human and economic development through jobs and growth," Gaboury added.
The survey is the world’s leading barometer of trade finance health. It includes data from 137 banks and 185 companies from around 50 countries.
Read: Stakeholders for circular economy in Bangladesh's garment sector
Respondents said they faced continued constraints in 2022 due to rising interest rates and financial market uncertainties, set against the backdrop of a global economic slowdown, and geopolitical instability.
Around 60 per cent of responding banks reported that the Russian invasion of Ukraine impacted their trade finance portfolios due to growing geopolitical uncertainty and increased commodity prices.
For the first time, the 2023 trade gaps survey focuses on environmental, social, and governance (ESG) issues, along with digitalization, in a bid to assess their impact on relevant supply chains and the trade finance gap.
Read: Bangladesh Bank seeks explanations from 13 banks for selling dollars at higher prices
Most of the banks and companies that took part in the survey believe that ESG alignment could potentially help reduce the trade financing gap.
The top supply chain challenge cited by firms surveyed was insufficient financing. They identified access to adequate financing, reliable logistics, and the use of digital technology as the three most important components of resilient supply chains.
Exports robust, August earnings rise to $4.78 billion
Bangladesh’s export earnings increased by 3.8 percent year-on-year to USD $4.78 billion in August, compared to the previous fiscal year (FY2022-23).
The Export Promotion Bureau (EPB) published this information on Monday (September 04, 2023), which shows that the garment sector is the major contributor to the overall export earnings.
The sector insider shows it as good news amidst falling inward remittances in August.
Also read: RMG exports for July-August this year grow by 12.46%
As a percentage, compared to 2022, export income increased by 3.8 percent in August 2023. However, the government's target was not met. The government's export revenue target for that month was over $4.87.
According to EPB data, 26 types of products including garments, medicine, and leather were exported to the world market in the month of August of the current financial year 2023-24. From there, $4.78 crore has been earned in August.
Also read: RMG exports: Bangladesh earned $3.95 billion in July, says BGMEA
During the same period of the financial year 2022-23, the export revenue was $4.6 billion. Accordingly, compared to last year, the income has increased by $17.51 crore, which has increased by 3.8 percent.
Also read: Bangladesh's RMG export to USA grows 6.31% in FY 2023-24
BGMEA-Circle Economy ink MoU to accelerate garment, textile sector’s transition towards circular economy
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Circle Economy have entered into a partnership to accelerate the transition of Bangladesh’s garment and textile industry towards the circular economy.
Faruque Hassan, president of BGMEA and Hilde van Duijn, head of Global Value Chains in Circle Economy, signed a Memorandum of Understanding (MoU) on behalf of their respective organizations at the Amari Hotel in Dhaka on Monday.
The collaboration between the parties aims to enable greater coordination in regard to sharing expertise, raising awareness and disseminating knowledge to enable BGMEA members to adopt and implement circular strategies.
Read: Helen Keller International and BGMEA join forces to enhance eye care for garment workers and boost productivity
The parties aim to collaborate within the context of the SWITCH2CE project, specifically on the creation and dissemination of the capacity building programme.
Areas of cooperation identified in the capacity building programme include exchanging knowledge, sources and insights on the value chain for (post-industrial) textiles in Bangladesh and disseminating the Circularity Game as the tool to assess current awareness and knowledge on circularity amongst BCMEA members.
Read more: South Korean Ambassador, BGMEA President discuss ways to boost trade, investment
Stakeholders for circular economy in Bangladesh's garment sector
A diverse group of stakeholders from the garment and textile industry gathered at BGMEA Complex in Dhaka on Monday to discuss the prospects of circular economy in the country.
Industry leaders, policymakers, brands, development partners, suppliers, recyclers and banker attended at a roundtable to discuss the issues.
They discussed the challenges and opportunities of transitioning to a circular economy in Bangladesh, as well as the way forward to build a circular industrial ecosystem in the country.
The roundtable was as a part of a dialogue titled “Switch to Upstream Circularity: Pre-consumer Textile Waste in Bangladesh.”
This event was organised under the Switch to Circular Economy Value Chains project (SWITCH2CE), co-funded by the European Union and the Government of Finland.
SWITCH2CE is led by United Nations Industrial Development Organization (UNIDO), in collaboration with Chatham House, Circle Economy, and European Investment Bank, and supports the switch to circularity in selected global value chains.
Thanking all the participants, BGMEA President Faruque Hassan said the event would pave the way for bringing thoughts, ideas and experiences together in order to pursue a common goal – to transform the industry into a circular manufacturing hub.
Read: Helen Keller International and BGMEA join forces to enhance eye care for garment workers and boost productivity
Jeremy Bruer, Australian High Commissioner to Bangladesh, Mark Draeck, Chief Technical Advisor on SWITCH2Circular of UNIDO; Holly Syrett, Director of Impact Programmes and Sustainability at Global Fashion Agenda; Nin Castle, Chief Program Officer- Co-Founder, Reverse Resources, Abdur Rahim Khan, Additional Secretary to Commerce Ministry, Mahbub ur Rahman, CEO of HSBC Bangladesh, Enamul Huque, Managing Director and Country Head of Corporate of Commercial and Institutional Banking at Standard Chartered Bank, Humaira Azam, Managing Director and Chief Executive Officer of Trust Bank, joined the roundtable.
Moderated by Barrister Vidiya Amrit Khan, Director of BGMEA, the discussion was also attended by representatives from brands including H&M, BESTSELLER, KIABI, Kmart Australia, Primark, Decathlon, GIZ and other stakeholders.
They discussed how Bangladesh could embrace circular practices, reduce the environmental footprint of the textile sector, create new job opportunities and bolster their international reputation as a hub for sustainable manufacturing.
Read more: South Korean Ambassador, BGMEA President discuss ways to boost trade, investment
Bangladesh Bank seeks explanations from 13 banks for selling dollars at higher prices
The Bangladesh Bank (BB) has sought an explanation from 13 banks for selling US dollars at high prices.
The summoned banks belong to the private sector, including a Shariah-based Islami Bank.
The central bank confirmed the information on Monday (September 04, 2023). The letter was sent to different banks on Sunday (September 3) and the banks have been asked to provide an explanation in this regard within the next five working days.
Also read: Dollar goes off kerb market after central bank-led raids of money exchanges
The bank’s Executive Director and Spokesperson Md. Mesbaul Hoque told UNB that the trading licences of seven money changers have been suspended for selling dollars at higher prices.
An explanation has been sought from 10 more money changers following similar complaints. In addition, banks are also being monitored. Punitive action will be taken if concrete evidence is found, he said.
In August, the maximum import price of Tk109.5 was set, but some banks sold dollars up to Tk117, and bought it at Tk116.
Also read: Bangladesh Bank working to normalise inflation and dollar crisis despite geopolitical challenges
Dollar transactions are inspected by Bangladesh Bank's Financial Integrity and Customer Service and Foreign Exchange Inspection Departments. Recently, the central bank sent for inspection due to the increase in the price of the dollar. After collecting the information, the issues of dollar sales are being verified.
In 2021, the central bank ordered to spend Tk 500 crore on the CSR sector from the profits of 12 banks due to excess profit. There were two foreign-owned banks and 10 private sector banks on that list.
The dollar crisis in the country has become evident since March last year after the start of the Russia-Ukraine war. To deal with this crisis, the central bank fixed the dollar price at the beginning, but the crisis continued.
Also read: Bangladesh Bank introduces 'market-based' dollar exchange rate with rate cap
Direct flight from Bangladesh-Japan to deepen bilateral ties: State Minister for Civil Aviation
State Minister for Civil Aviation and Tourism Md Mahbub Ali on Monday said direct air connectivity between Bangladesh and Japan will play an important role in making the existing bilateral relations more effective and wider.
He said this while addressing an event organised by Biman Bangladesh Airlines on the grand opening of the Narita (Japan)-Dhaka Flight at a hotel in Japan’s Narita on Monday night (local time).
This flight is a gift from the prime minister to Bangladeshi expatriates brothers and sisters, he said, hoping that it will help expatriates keep a close relation with the country and make their journey to the country hassle free and more comfortable.
the Bangladeshis will avail themselves to visit Japan easier, he said.Simultaneously, Japanese people can visit and enjoy Bangladeshi beautiful nature, rivers, mountain, the world's longest sea beach at Cox’s Bazar, greenery of tea gardens in Sylhet, traditional food and warm hospitality, colourful festivals, archaeological sites, many ancient mosques and temples, UNESCO declared world heritage and the world's largest mangrove forest Sundarbans, sixty dome mosque of Bagerhat and Paharpur Buddhist Vihara etc.
Actually, the aviation and tourism industry will take the relationship of the two countries further forward by creating people-to-people relations, he hoped.
Read: Biman’s Dhaka-Narita direct flights will boost Bangladesh-Japan trade, relations: BCCIJ president
He said opportunities for economic and technological cooperation, trade and investment, education, tourism, culture and sports activities will increase between the countries in the days to come.
Bangladesh offers an unparalleled investment climate compared to the other South Asian economies. Bangladesh is a largely homogeneous society with no major internal or external tensions and a population with great resilience in the face of adversity, the state minister said.
Mahbub Ali said the confidence of foreign investors in Bangladesh has increased, as the country has taken a series of measures to build up investment-friendly infrastructure; develop the energy sector; provide necessary facilities and support to set up industries and simplify rules and regulations.
Read more: Dhaka-Narita Tokyo direct flights launched
Dollar goes off kerb market after central bank-led raids of money exchanges
The dollar crisis in the kerb market has grown deeper after Bangladesh Bank and law enforcers raided the money exchange houses with allegations of profiteering by charging higher exchange rates.
In the last two weeks, the exchange rate of the US dollar in the kerb (open) market reached Tk117 to 118 per dollar from Tk112. Under the central bank's direction, law enforcers raided different exchange houses in different areas of the capital towards the end of last week, and over the weekend.
During these raids, the exchanges were strictly instructed to sell dollars at the previous rate of Tk 112 to 113.
Also read: Bangladesh Bank working to normalise inflation and dollar crisis despite geopolitical challenges
But not, on the first working day of this week, it emerged that stung by the raids, the money exchanges have taken the dollar off the market completely. You cannot buy a dollar for even Tk120, as the exchange houses are resolutely stating they have no dollar to sell.
Licenses of several establishments were suspended and sealed for selling dollars at high prices. In such a situation, money exchange institutions have almost stopped selling dollars due to fear of punishment. As a result, there is a shortage of dollars in the open market, said the sector insiders.
Replying to a query about the dollar crisis in the kerb market, Bangladesh Bank Executive Director and Spokesperson Mesbaul Hoque told UNB that the dollar is being traded, but not everyone is selling it. Only those who have dollars are selling, according to the spokesman.
Also read: Bangladesh Bank introduces 'market-based' dollar exchange rate with rate cap
Zaman (not real name), the owner of a money exchange house in the Motijheel area, told UNB on Sunday that they cannot buy even at Tk115, how can it be possible to sell dollars at Tk 112-113, he questioned.
Many other money exchange houses and individual floating traders of the US dollar were seen passing idle time on Sunday due to the supply crisis of the dollar.
This dismal picture was seen visiting money exchanges in Motijheel, Paltan, and Baitul Mukarram areas of the capital
Our correspondent searched in other areas like Gulshan, Banani, Mohakhali, and Farmgate too, with no luck.
Also read: Dollar exchange rate for repatriated export income increased to Tk107.5
“Money changers buy from one person and sell to another. At the current rate, the money changers have to buy dollars at Tk110 to sell dollars. How will money changers get dollars if no one sells dollars below Tk112? Trader can't sell if he doesn't get dollars, money changers pointed out,” said Aynal, who has been involved in dollar trading for the last 12 years.
Oram Faruk came to Motijheel to buy dollars as he has to go to Thailand on September 6. He visited several banks to buy dollars for expenses but did not get any.
“Now came to the money changer, no dollars here either. I called an acquaintance in Gulshan to manage $400, which is possible at a cost of Tk120 per dollar," Omar said.
Asked why he would agree to buy at such steep rates, Omar pointed out: "Regardless of the price, how can I go abroad without dollars?"
Also read: Interbank dollar exchange rate jumped to Tk109
Stakeholders collaboration, innovative business model stressed for transition to circular economy in Bangladesh’s textile and garment industry
Speakers at a panel discussion stressed the need for collaborative approach of the industry stakeholders, innovative business model, and financial support mechanism to foster a circular industrial ecosystem in order to drive transition of Bangladesh’s RMG industry to circular economy.
The discussion was as a part of a dialogue titled “Switch to Upstream Circularity: Pre-consumer Textile Waste in Bangladesh”.
This event was organized under the Switch to Circular Economy Value Chains project (SWITCH2CE), co-funded by the European Union and the Government of Finland. SWITCH2CE is led by United Nations Industrial Development Organization (UNIDO), in collaboration with Chatham House, Circle Economy, and European Investment Bank, and supports the switch to circularity in selected global value chains.
Dishan Karunaratne, Chief Representative of Bangladesh and Pakistan at BESTSELLER, Dr. M. Masrur Reaz, CEO of Policy Exchange, Mohammed Zahidullah, CSO of DBL Group, Md. Shahidullah Azim, Vice President of BGMEA and Syed Mahbubur Rahman, Managing Director and CEO of MTB, BD took part in the panel discussion on “Enabling a circular industrial ecosystem by an innovative business model”.
Moderated by Shams Mahmud, Managing Director of Shasha Denims, and also the Chair of BGMEA Standing Committee on Foreign Mission Cell, the panelists discussed circularity scenarios and possible solutions to successfully transform Bangladesh’s garment and textile industry to integrate circularity into the value chain.
Challenges of circularity for Bangladesh’s apparel industry must be collectively considered, resolved: Speakers
Circularity presents a significant opportunity for Bangladesh to reduce its environmental impact, improve its economic performance, and create social benefits, experts have said.
However, embracing circularity also poses certain challenges for Bangladesh’s apparel industry that must be collectively considered and resolved, they said.
An esteemed panel of industry leaders, policymakers, and experts in circular economies convened for the "Switch to Upstream Circularity Dialogue: Pre-consumer Textile Waste in Bangladesh" event at the Amari Hotel in Dhaka Sunday.
The dialogue covered the strategies, policies, infrastructure, collaborations, and innovations necessary to build a thriving circular ecosystem in Bangladesh.
This event was organized under the Switch to Circular Economy Value Chains project (SWITCH2CE), co-funded by the European Union and the Government of Finland. SWITCH2CE is led by United Nations Industrial Development Organization (UNIDO), in collaboration with Chatham House, Circle Economy, and European Investment Bank, and supports the switch to circularity in selected global value chains.
A diverse group of stakeholders attended, including brands, manufacturers, policymakers, and financial institutions.
Saber Hossain Chowdhury MP, Chair of the Parliamentary Standing Committee on the Ministry of Environment, Forest and Climate Change, Bangladesh, and the Special Envoy to Prime Minister Sheikh Hasina for Climate Change, was present in the opening session as chief guest.
Faruque Hassan, President, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) spoke at the opening session as a special guest.