Bangladesh Garment Factories to Re-Open After Wage Agreement

Bangladesh garment factory owners agreed to a minimum wage of 5,300 taka ($68) a month for workers, promising to end a labor dispute that has shut factories in the Ashulia industrial zone on the outskirts of the capital Dhaka.

A group of owners met Prime Minister Sheikh Hasina, who urged them to accept a recommendation made by a government-appointed panel, Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association, said in a phone interview from Dhaka.

“We have agreed to the recommendation and I hope labor unrest will now come to an end,” he said, after the meeting.

BGMEA also reversed an earlier decision to keep about 250 factories shut in the industrial zone, he said. “There is no point keeping the factories shut as we have agreed to the recommendation,” Islam said. “We have decided to resume operations of those factories tomorrow.”

Ashulia factories account for 35 percent of Bangladesh’s garment output and supply to retailers including Hennes & Mauritz AB (HMB) and Wal-Mart Stores Inc. (WMT), according to Abdus Salam Murshedy, president of the Exporters Association of Bangladesh.

Bangladesh has the second-lowest wages in Asia after Myanmar and that cheap labor has spawned a $20 billion garment industry that supplies global retailers. Labor tensions have risen in recent months as factory owners and workers have failed to agree on salaries.

To contact the reporter on this story: Arun Devnath in Dhaka at adevnath@bloomberg.net

To contact the editor responsible for this story: Cecile Daurat at cdaurat@bloomberg.net

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