Retailer calls for wage increases in Bangladesh

H&M Hennes & Mauritz has met with Bangladesh’s minister of commerce, Tofail Ahmed, calling for annual wage increases for those working in the garment sector.

CEO Karl-Johan Persson presented the retailer’s proposal for effective systems that regulate costs and prices in Bangladesh.

“We commend the Government of Bangladesh for addressing minimum wages. However, we see that costs in society are negating many of the positive effects of increased wages. This is due to the absence of efficient systems of cost control leaving both workers and business owners in a difficult situation,” said Persson.

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The company said that to ensure the needs of workers as well as the continued competitiveness of the Bangladeshi textile industry, it needs to create a continued wage development through annual revisions based on cost price index is necessary. It is also encouraging the government to address the issue of cost regulation, on for example rent and basic commodities.

At the meeting, Karl-Johan Persson highlighted the importance of establishing a structure for compensation in case of workplace accidents and a greater government attention on the shortage of clean water, which could lead to major health issues as well as a halt to the development of the Bangladeshi textile industry.

The retailer emphasised that it is important that the Bangladeshi garment industry is further stabilised since foreign trade in general and garment production plays a major role in the industrial development of emerging markets.

For H&M it is important that the Bangladeshi garment industry is further stabilized, since foreign trade in general and specifically garment production plays a major role in the industrial development of emerging markets. Finding a job in the textile industry is an effective and important way to leave poverty for many people, not least for women.

H&M said it sources products from 300 factories employing over 600,000 workers in the country.

The comments came as the retailer reported an 8% increase in sales, including VAT, September.

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