Impact of Global Recession on Readymade Garments (RMG) Sector of Bangladesh

The latest financial crisis has taken the whole world aback posing threat to the RMG producers and the overall industry prosperity. Bangladesh RMG industry is also placed in an extremely vulnerable position and has started to experience consequences of the financial turmoil. Though the extent of bearing seems to be minimal, it is assumed that if the recession continues, the RMG sector might be hit badly in the long run. For Bangladesh the central bank has strictly controlled the dollar exchange rate to facilitate the RMG sector’s operation. With the exporters’ profit margin1 declination, if the recession continues, it would be hard to sustain. To face the detrimental effect of the recession Bangladesh need to take innovative marketing strategies to attract more order, focus on exploring new markets to minimize the dependency on few buyers, try collectively to improve its bargaining skills, take step for infrastructure development to ensure adequate electricity, gas and port facility, emphasize on efficiency and productivity increase, develop more backward linkage2 facility and increase the level of value addition by better combining the players in the chain and establishing industry hubs where a whole production industry including small backward linkage units will carry on the process in harmonized succession.