The American retailers have progressively been lowering the prices they pay for Bangladeshi garment items, a recent study found.
For instance, trousers, the most popular export item from Bangladesh to the US, saw its prices decline 40.89 percent between 2000 and 2014, said Mark Anner, an associate professor of the Pennsylvania State University, who conducted the study.
Anner compared the import prices of items from top 20 of the US’s sourcing nations like China, Vietnam, Bangladesh, Mexico and India between 1989 and 2014.
The findings of the study were presented yesterday at the office of the Bangladesh Garment Manufacturers and Exporters Association.
At the same time, the prices of garment items from China and Vietnam have increased, according to the study.
Bangladesh is the largest exporter of men’s and boy’s trousers to the US, followed by China, Mexico, Vietnam, Pakistan and Indonesia.
To improve the situation, Anner suggested three options: information sharing and awareness, government’s initiatives to break up the unfair competition, and coordination among weaker actors (suppliers’ coordination) to address the power imbalance in the supply chain.
Khondaker Golam Moazzem, an additional director of the Centre for Policy Dialogue, said practising ethical profit sharing can ensure proper pricing of items.
He also said Bangladesh will face further competition in the US market if the proposed Trans-Pacific Partnership (TPP) is finalised, as the top 10 garment items from both of Bangladesh and Vietnam are the same.
Vietnam is the only garment producing country that is included in the proposed TPP.
BGMEA President Atiqul Islam said the garment sector has been facing stiff competition for different reasons and in such a critical time, the government increased the tax at source.
Subsequently, he urged the government to reinstate the previous source tax rate of 0.80 percent instead of the proposed 1 percent.
Source: The Daily Star