Could COP28 bring hope for Bangladesh's RMG industry?

The apparel sector is the main source of Bangladesh's export earnings and employment generation. In 2022-2023, Bangladesh exported apparel worth $46.99 billion, about 84% of the country's total export earnings. 

The industry is crucial for Bangladesh regarding export earnings and employment generation. RMG has created employment for around four million people and lifted them from the abyss of poverty. 

The sector has been making an outstanding contribution to poverty alleviation in Bangladesh. It has employed a large number of people, primarily the poor, allowing them to free themselves from the curse of chronic poverty. 

For example, in the 2008-2009 FY, the total RMG export earnings were $12.35 billion, while the poverty rate was 40%. After five years, in 2013-14 FY, the size of the apparel industry almost doubled, with total apparel export earnings of $24.49 billion, and the poverty rate decreased to 26%. 

The country's apparel sector alone has created employment for 3.6 million women, which is undoubtedly significant. Since most of these women have mainly come from rural areas and have little or no education, their employment in any formal sector would have been impossible without this industry in Bangladesh. 

But climate change poses a significant threat to the country's strong growth potential, and the risk of its people falling again into poverty is looming large. Bangladesh is one of the most vulnerable countries to climate change, and the effects of climate change are already visible in the country. 

Due to climate change, salinity is increasing at a threatening speed in the coastal areas of Bangladesh. According to media reports, in the last 35 years, salinity increased by around 26% in the country, spreading into non-coastal areas as well. 

It has been estimated that by 2050, one in every seven people in Bangladesh will be displaced by climate change. Specifically, with a projected 19.6 inch (50 cm) rise in sea level, Bangladesh may lose approximately 11% of its land by then, and up to 18 million people may have to migrate because of sea-level rise. 

Despite producing only 0.56% of the global emissions, Bangladesh is leading in green industrialisation. The presence of more than 200 green factories, LEED-certified by the United States Green Building Council (USGBC), is a testament to the country's commitment to climate action. The apparel factories in Bangladesh are also aiming to adopt eco-friendly production processes.  

Nevertheless, actions from individual industries or countries would not suffice to combat global warming; the world has to work together. 

The world leaders gathered in Dubai this month at the United Nations Climate Change Conference (COP28) to discuss the new ways to tackle climate change. The COP28 ended with an agreement signalling the "beginning of the end" of the fossil fuel era.

"Whilst we didn't turn the page on the fossil fuel era in Dubai, this outcome is the beginning of the end. Now all governments and businesses need to turn these pledges into real-economy outcomes, without delay,'' said UN Climate Change Executive Secretary Simon Stiell in his closing speech. 

The leaders at the COP28 called on stakeholders to take action towards achieving a global tripling of renewable energy capacity and doubling energy efficiency improvements by 2030. The list also includes accelerating efforts towards the phase-down of unabated coal power, phasing out inefficient fossil fuel subsidies, and other measures that drive the transition away from fossil fuels in energy systems.

The fashion industry must work together to shift from fossil fuel to green energy. Many brands and retailers announced their ambitious goals even before the COP28. However, the missing link was that the manufacturers were not considered vital stakeholders in giving input while the brands and retailers declared their lofty sustainability goals. 

There are some realities on the ground which need to be considered. For example, some brands have declared their target of achieving 30% energy from renewable sources. However, it has been estimated that from the existing rooftop solar PVs, manufacturers can generate a maximum of 25% renewable energy of their total energy consumption. On the other hand, the thermal machinery of garment and textile factories, such as boilers, cannot be run by renewable energy. 

So, the importance of apparel buyers and manufacturers sitting together and jointly finding ways to reduce their dependence on fossil fuels and use green energy cannot be overstated. Without the active participation of the manufacturers, the brands and retailers cannot achieve their Scope 3 emission target. So, the active engagement of the manufacturers is also required when the buyers plan their sustainability goals. 

Indeed, there are many ways to shift from fossil fuels to green energy since Bangladesh is developing quickly. The government has already started the work of establishing nuclear power plants. The experiment of generating energy from windmills is also making good progress. 

With all these developments in the offing, Bangladesh could lead the global apparel industry and set an example for others regarding green energy and industry. 

The Green Climate Fund (GCF) also boosted the two-week-long conference. Eight donor governments announced new commitments to the Least Developed Countries Fund and Special Climate Change Fund, totalling more than $174 million. In contrast, new pledges, totalling nearly $188 million, were made to the Adaptation Fund at COP28. 

International organisations, including fashion brands and retailers, should also work to ensure garment factories have access to these green finances. The availability of finance is the main challenge the small and medium-sized apparel factories face in converting their facilities to be more eco-friendly. 

Abdullah Hil Rakib is the Managing Director of Team Group and the Director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.