The devastating fire that killed 112 textile workers in Dhaka late last month has restarted the debate over the appalling living and working conditions in Bangladesh. While the country’s GDP has been growing at a steady (and respectable) 6% over the last fifteen years, poverty and underdevelopment remain alarmingly high. More than 500 workers have lost their lives in workplace tragedies since 2006. The more than 4,000 clothing factories in Bangladesh are generally lacking in safety and hazard prevention. In the most recent case, emergency exits were locked from the outside, blocking any escape routes from the fire. The company affected by the fire produced garments for important American and European retailers. Outsourcing to Bangladesh has been very profitable, because labor-intensive manufacturing benefits heavily from the low cost of labor there: the average Bangladeshi salary is 37 dollars per month. More than 3 million people in Bangladesh work as textile workers, and most of them are women. Multinational corporations avoid the safety regulations that exist more as a formality, signing contracts with intermediaries who are ultimately responsible for conditions in the factories. Criticism from labor unions and humanitarian agencies has been scathing, consistent with conditions in the factories, and has given rise to violent protests. The textile industry is a vital component of the country. Along with funds sent home by emigrants, it is the main component of Bangladesh’s GDP. Foreign investment has propelled the country to second place among the world’s ranking of exporters of manufactured goods. Even China, firmly in first place, has begun to outsource to Bangladesh, where the cost of labor is even lower. This performance has helped the country weather the crisis that began in 2008, and the World Bank is predicting 6% growth again for 2013. The numbers confirm the country’s 2005 inclusion in Goldman Sachs’ Next 11 emerging economies. Despite the growth of Bangladesh’s GDP, poverty and underdevelopment continue to plague the country. Of its 162 million inhabitants, nearly one third still lives below the poverty line, putting Bangladesh among the lowest per-capita GDP’s in the world. Living conditions are still generally backward, and the country has been unable to defeat corruption and destitution. The lack of political stability or a basic communication system makes it difficult to imaging more sustained and constant growth. If Bangladesh does not carry out structural improvements, its rise will be short-lived, because it is difficult to make progress by counting on the low wages and the manufacture of goods in sectors that are already mature.
