After a week of sometimes violent protests in Bangladesh, factories have reopened after the owners had promised hefty wage increases for all textile employees.
Higher wages by the end of November
The wage increase should be there by the end of November, even though the size of the increase is not certain. Labour unions demanded more than a doubling of the wages, from the current minimum wage of 28 euro per month (the lowest number in the whole world) to at least 75 euro.
A government panel still has to set the exact amount, but the factory owners have agreed to accept whatever decision is made. “We have promised the labour unions that we would increase wages, as soon as the government panel announces the new minimum wage."
"We will even accept a rise that exceeds 20 %, even though we hope that the increased wages are a win-win situation for both the industry and the employees”, Atiqul Islam, head of the Bengal textile producer association, told AFP.
Fear of decreased competitiveness
The association fears that an increase higher than 20 % would decrease the industry’s competitiveness with other countries out of the region, like China and Vietnam. However, China has had to increase wages dramatically over the past few years, without a negative impact to its competitiveness. It is expected that Bangladesh, worldwide number two for textile, will be able to handle the changed worker conditions.
The protests have forced the factories to shut down for an entire week and it is estimated the problems cost the Bengal textile industry some 30 million euro.