Contribution of rmg sector in economic growth of BD

CONTRIBUTION OF RMG

SECTOR IN ECONOMIC

GROWTH OF BANGLADESH

ECO 501 Managerial Economics

Section:2

08/04/2023CONTRIBUTION OF RMG SECTOR IN ECONOMIC GROWTH OF BANGLADESH

2

GROUP MEMBER

ID Name

13264078 Shahriar Rawshon (Team Leader)

13264069 Anik Mondal

13264070 Shahreen Shabnam

13364058 Umama Akter

13164023 Pallab Kanti Das


3

OUTLINE

Introduction

Objective of the Study

Limitation of the Study

Methodology

Contribution of RMG Sector in Economy

Economic Growth Analysis of RMG Sector Present and Past

Social Impacts of the RMG Sector


4

Introduction


5

THE OBJECTIVE OF THE STUDY

To evaluate the economic impacts of RMG sector in Bangladesh in terms of GDP, GNP, National income and Total exports.

To evaluate the social impacts of RMG sector in Bangladesh in terms of women empowerment, savings, child labor, population control and employment.


6

LIMITATION OF THE REPORT

The information gap between the different sources of statistical and historical data,

Available data was poorly updated,

Lack of cooperation on sourcing data from some important organizations.

A Number of Limitation


7

METHODOLOGY OF THE STUDY

Secondary data analysis forms the basis of the report

Sources of secondary data:Literature reviewCase studies in other countries, Journals, Research articles, Thesis papers, Newspapers, Online news and survey reports, Different internship reports andBooks and articles from libraries.


8

OVERVIEW OF THE BANGLADESHI ECONOMYGDP: US$ 112 billion (FY 2011-12)

Annual Average Growth Rate: 6.30 % (FY 2010-13)

Point to point Inflation rate of 2012-13 is 6.78%

Contribution of Manufacturing to GDP: 19.54%

Foreign Direct Investment (FDI) in 2012 : $1.3 billion

Sectoral Contribution of the Industry is 32.0 % (GDP Share 30.4%( FY 2009-13)Export Growth is 10.7% in FY 2013 (July-May)

Foreign Exchange Reserve Growth: 47% (FY 2013)


9

ECONOMIC SECTORS

Agriculture

Manufacturing and industry• RMG and Textiles• Small and Medium Enterprises• Export

Power and Energy Sector


10

GDP GROWTH BY SECTOR

GDP Growth by sector


11

BANGLADESH'S RMG EXPORT IN GDP

75.65%

4.22%2.60%

2.19%

1.77%

1.21%

0.72%

0.06%

11.56%

Major Products Export From Bangladesh And Contribution to GDP

RMGFrozen FoodJute GoodsLeatherChemical ProductsRaw JuteAgri ProductsTeaOthers


12

FORECAST ON PERCENTAGE OF RMG IN NI.

Fiscal Year 2007 -08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

Export as % of NI

9.6% 9.8% 9.1% - - - -

2007 -08

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

Export as % of NI

Export as % of NI


13

THE APPAREL INDUSTRY IN BANGLADESH (KEY FACTORS) Export Earnings Major Player in the Exports Helping Industrialization Employment Generation Women Empowerment Contribution to the GDP Growth of Backward and Forward

Linkage Industries


14

GOVERNMENT SUPPORT AND OPPORTUNITIES TO ATTRACT INVESTORS 15% cash subsidy of the fabric cost . Establishment of new textile/RMG mill in the private

sector Joint ventures with the existing textile/RMG mill Public sector textile mills that are being privatized Indirect investment through financial services and/or

leasing Introducing back to back LC Warehouse facilities


15

YEAR-WISE/SCHEDULE TEXTILE AND APPARELS DISTRIBUTION INVESTMENT(IN CROR.)

2007 2008 2009 2010 2011 2012 20130

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

22,193

10,730 9,200

26,566 26,174

14,839

81,667

Textiles and Apparels

Textiles and Apparels

Source: DIPP


16

CONTRIBUTION TO NATIONAL ECONOMY The sector contributes 38% industrial value addition. Earns around 78% of total export earnings. Employs around 4.5 million workforce of which

majority is women Generates huge cliental base for Banking, Insurance,

Shipping, Transport, Hotel, Cosmetics, Toiletries and related

other economic activities. Provides indirect employment to 0.80 million

workforces in accessories industries related to garments.

Provides 0.2 million job to waste recycle industry related to RMG sub- sector.

Contributes 10.50% to GDP through RMG sub-sector.


17

COMPARATIVE STATEMENT ON EXPORT OF RMG AND TOTAL EXPORT OF BANGLADESH

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

EXPORT OF RMG (IN MILLION US$)

9211.23 10699.8 12347.77 12496.72 17914.46 19089.69 21515.73

TOTAL EXPORT OF BANGLADESH (IN MILLION US$)

12177.86 14110.8 15565.19 16204.65 22924.38 24287.66 27018.26

25007500

12500175002250027500

Comparative Statement on Export Of RMG And Total Export Of Bangladesh

Valu

e

Source: Data Source Export Promotion Bureau Compiled by BGMEA


18

COMPARATIVE STATEMENT ON EXPORT OF RMG AND TOTAL EXPORT OF BANGLADESH

Figure : Comparative Statement on Export Growth Of RMG In Bangladesh

75.64

75.83

79.3377.1278.15

78.6

79.63

% OF RMG'S TO TOTAL EXPORT

2006-072007-082008-092009-102010-112011-122012-13


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VALUE AND QUANTITY OF TOTAL APPAREL EXPORT FISCAL YEAR BASIS

Total Apparel Export In Mn.UD$Total Apparel Export In

Mn.Dz

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-20130

5000

10000

15000

20000

25000

9211

.23

1069

9.8

1234

7.77

1249

6.72

1791

4.46

1908

9.73

2151

5.73

TOTAL APPAREL EXPORT IN MN.US$ WOVENTOTAL APPAREL EXPORT IN MN.US$ KNITTOTAL APPAREL EXPORT IN MN.US$ TOTAL

0

200

400

600

800

1000

1200

1400

1600

332.

62

389.

03

460.

51

465.

5

1345

.4

1276

.7

1487

.11

TOTAL APPAREL EXPORT IN MN.DZ WOVENTOTAL APPAREL EX-PORT IN MN.DZ KNITTOTAL APPAREL EXPORT IN MN.DZ TOTAL

Source

: Data

Source

Export P

rom

otio

n B

ure

au C

om

pile

d

by B

GM

EA


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BANGLADESH'S RMG EXPORT TO WORLD

Wo-ven

2010-11

Wo-ven

2011-12

Wo-ven

2012-13

Knit 2010-

11

Knit 2011-

12

Knit 2012-

13

Total 2010-

11

Total 2011-

12

Total 2012-

13

EU % of World

42.81 46.31 46.87 72.87 73.04 70.55 58.72 59.59 58.4

% of USA

41.58 36.61 35.02 11.8 10.69 10.8 25.82 23.73 23.22

% of Canada

5.48 4.93 4.69 4.57 4.24 4.41 4.99 4.58 4.56

5

25

45

65

EXPORT growth to the World

Grow

th in w

orld

Source: EPB, Compiled by: RDTI Cell, BGMEA


21

BANGLADESH'S RMG EXPORT TO WORLD

Wo-ven

2010-11

Wo-ven

2011-12

Wo-ven

2012-13

Knit 2010-

11

Knit 2011-

12

Knit 2012-

13

Total 2010-

11

Total 2011-

12

Total 2012-

13

EU Growth%

NaN 23.18 16.35 NaN 0.27 6.67 NaN 8.13 10.45

USA Growth%

NaN 0.27 9.96 NaN -9.39 11.53 NaN -2.07 10.31

Canada Growth%

NaN 2.44 9.57 NaN -7.18 14.97 NaN -2.21 12.05

-12.5

-7.5

-2.5

2.5

7.5

12.5

17.5

22.5

27.5

EXPORT Growth Trend

Grow

th %



22

PERCENTAGE OF TOTAL GROWTH IN RMG WITH MAJOR AND NONTRADITIONAL COUNTRIES

2010-11 2011-12 2012-13 2010-11 2011-12 2012-13 2010-11 2011-12 2012-13Woven Knit Total

0

2

4

6

8

10

12

14

1613.88

14.96

0.05

10.43

6.56

12.71

Total % Growth

% Growth



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EXPORT PERFORMANCE OF RMG OVER GOVERNMENT'S STRATEGIC TARGET

Knitwear

Woven

0.00 5,000.00 10,000.00 15,000.00

11,575.85

12,571.46

5,407.08

5,872.12

Performance over Target of RMG in

2013-2014

Performance Over Target 2013-14 (Jul-Dec)Target (million USD) 2013-14

2011-12 2012-130

1000

2000

3000

4000

5000

6000

7000

8000

6928.697306.28

Region wise Export Perfor-mance FY 2011-12 & 2012-13

EUUSA & CanadaEuropean Free Trade Associa-tionLatin American Integration As-sociationEmerging MarketsOthers

FY Year

Valu

e

Source: Export Promotion Bureau, Bangladesh


24

SOCIAL IMPACTS OF THE RMG SECTOR

Women Empowerm

ent

Savings

Child Labor

Population Control

Employment


25

WOMEN EMPOWERMENT

Bangladesh India Pakistan Nepal Sri Lanka

90%

34%

10%15%

87%

76%

13%

60%

38%

52%

Female Contrbution in South Asia

Percent of Female Percentage of Total Export


26

SAVINGSRegular earning

Workers investments on family pension schemes etc. create savings.

15 years and above had their own bank accounts.

A higher proportion of workers (30 percent) had bank accounts in the EPZ.

Women are on average better savers than men.

Women save about 7.6 percent of their otherwise small income.


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CHILD LABOR In 2000 a second MOU was signed between BGMEA and ILO focused

• A fact-finding survey to determine the extent of child labor in the garment industry;

• The establishment of an education program;• The establishment of a monitoring and verification

system; • The provision of income compensation in the farm of

a monthly stipend of Tk. 300, the equivalent of (at that time) US$ 7

ILO 2005 baseline survey on child labor in hazardous situations found

• The one sector where legal restrictions on use of child labor showed to be successfully forced was the Ready-made Garment industry, while around 532,000 child laborers were working in hazardous situations in other industries.


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POPULATION CONTROLEmployment opportunities especially for women created positive impact on family

planning and population control in the country.

Independent working-women are getting more conscious about the advantage of a

small family.

Working adolescent girls tend to avoid early marriage.

The mean age at marriage for girls working in RMG factories tend to be higher

than the national average.


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EMPLOYMENT

Source: Bangladesh Garment Manufacturers and Exporters Association (BGMEA)

2.2 2.4 2.83.5 3.6 3.6

Employment (in million workers)

Employment (in million workers)


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Conclusion


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THANK YOU EVERYONE

Contribution of rmg sector in economic growth of BD

Economy & Finance

bangladesh

child labor

12072014 contribution

economic growth

rdti cell

bank accounts

population

comparative