DHAKA, BANGLADESH: The Asian Forum for Human Rights and Development (FORUM-ASIA), in collaboration with its member organisations, has issued a joint statement to stand in firm solidarity with distinguished Bangladeshi human rights defenders, Adilur Rahman Khan and ASM Nasiruddin Elan.

This follows the alarming news of their recent conviction to two years of imprisonment and a subsequent fine by the Dhaka Cyber Tribunal.

Adil and Elan are well-recognised for their relentless efforts at Odhikar, a leading organisation monitoring civil and political rights infringements in Bangladesh.

Their extensive work has captured significant instances of human rights transgressions, ranging from extrajudicial executions to grievous violence against women and minorities.

The duo, and by extension Odhikar, have been subjected to persistent judicial harassment since 2013.

This came in the wake of a report they released, revealing the extrajudicial killing of 61 individuals during a single-night clampdown on demonstrators.

In retaliation, authorities framed Adil and Elan with charges under Section 57 of the Information and Communications Technology Act of 2006, accusing them of disseminating “false and defamatory electronic information.”

Both faced prolonged periods of arbitrary detention before securing bail, with Adil detained for 62 days and Elan for 25.

Odhikar, along with its esteemed members Adil and Elan, has been a frequent target of orchestrated slander campaigns in response to their human rights activism.

Their organisation’s registration faced non-renewal in 2022 by the NGO Affairs Bureau (NGOAB), pointing to purportedly ‘erroneous information’ they published on extrajudicial executions. This decision was further backed by the Prime Minister’s Office.

Speaking on the matter, Mary Aileen Diez-Bacalso, FORUM-ASIA’s Executive Director, said, “The conviction, especially during the 25th anniversary of the UN Declaration of Human Rights Defenders, epitomises an alarming trend to suppress dissent and target the foundational values of democracy and rule of law. Bangladesh’s actions in this matter gravely conflict with their international obligations.”

It is critical to highlight that Bangladesh’s government has shown minimal initiative in addressing recommendations from prior Universal Periodic Reviews.

Many of these recommendations, chiefly focusing on the protection of human rights defenders from intimidation, have been largely ignored.

FORUM-ASIA, along with its allied bodies, is urging the Bangladesh government for the immediate and unconditional release of Adil and Elan.

They are appealing to the authorities to respect the rights of human rights defenders and ensure their safety.

The consortium stresses the importance of refraining from the criminalisation of human rights activities and calls on the government to honour its international commitments, encompassing the rights to free expression, association, and peaceful assembly.

Signatories of joint statement

1. Cambodian Human Rights and Development Association (ADHOC)
2. AWAZ Foundation Pakistan: Centre for Development Services (AWAZCDS)
3. Balay Alternative Legal Advocates for Development in Mindanaw (BALAOD-Mindanaw), The Philippines
4. Banglar Manabadhikar Suraksha Mancha (MASUM), India
5. Bir Duino, Kyrgyzstan
6. Bytes for All, Pakistan
7. Centre for Human Rights and Development (CHRD), Mongolia
8. Civil Society and Human Rights Network (CSHRN), Afghanistan
9. Defence of Human Rights (DHR), Pakistan
10. Asian Forum for Human Rights and Development (FORUM-ASIA)
11. Human Rights Measurement Initiative (HRMI), New Zealand
12. International Legal Initiative Public Foundation (ILI Foundation), Kazakhstan
13. Informal Sector Service Center (INSEC), Nepal
14. Karapatan Alliance Philippines (Karapatan)
15. Kazakhstan International Bureau for Human Rights and Rule of Law (KIBHR)
16. Cambodian League for the Promotion and Defense of Human Rights (LICADHO)
17. Maldivian Democracy Network
18. National Center Against Violence (NCAV), Mongolia
19. Philippine Alliance of Human Rights Advocates (PAHRA)
20. People’s Watch, India
21. PhilRights
22. People’s Solidarity for Participatory Democracy (PSPD), South Korea
23. Public Association “Dignity”, Kazakhstan
24. Pusat KOMAS, Malaysia
25. Task Force Detainees of the Philippines (TFDP)
26. Think Centre, Singapore
27. Women’s Rehabilitation Centre (WOREC), Nepal

by Roy Ngerng

Bangladesh is currently discussing raising the minimum wage for the garment sector.

In the first part on this topic, we saw how raising the minimum wage faster can expand Bangladesh’s economy.

In this part, we look at how doing so can lower unemployment and raise productivity, exports and profits.

Faster minimum wage growth leads to lower unemployment and higher productivity

Historically, when the minimum wage in Bangladesh’s garment sector was raised in 2006, 2010 and 2013, unemployment saw large declines (left chart below). The right chart uses a 10-year rolling average to show a clearer trend. (The unemployment rate is charted on an inverted axis for easier comparison.)

Data source: Minimum wage, Unemployment Rate

The World Bank similarly found that among South Asia’s apparel industry, “a one per cent increase in expected wages … could raise the probability of women entering the labour force by 18.9%”.

Higher minimum wage motivates workers to reenter the workforce to earn higher wages, which leads to higher consumer confidence and consumption, and in turn allow businesses to expand and hire more.

Historically, Bangladesh’s minimum wage growth also coincided with higher labour productivity growth (left chart below). The right chart shows productivity rising as minimum wage rises.

Data source: Minimum wage, labour productivity per hour worked

Among garment manufacturing countries, countries with higher minimum wages have productivity levels. Bangladesh pays the lowest minimum wages in Eurasia, and has the lowest productivity

Faster minimum wage growth also leads to faster productivity growth.

The Baltic countries grew their minimum wages fastest (as seen in part 1), and their productivity has risen fastest (see yellow lines below). This is followed by the Eastern European countries (blue lines) and East Asian countries (green lines).

Bangladesh’s minimum wage and productivity grew the slowest.

China used to have lower labour productivity than Bangladesh, but after its minimum wage started rising rapidly from 2004 (as shown in part 1), its productivity also rose faster.

Business Fights Poverty (BFP), the University of Cambridge Institute for Sustainability Leadership (CISL) and Shift found that workers who earn higher wages become more motivated, well-rested and take fewer sick days, thus making fewer mistakes.

They are less distracted by personal financial concerns and need not take on a second job, thus having better concentration and focus. Higher wages therefore lead to higher-quality labour with higher skills, and thereby drive innovation and open up new markets.

Among Vietnamese and Cambodian garment factories, businesses found that the higher productivity and higher gains brought about by higher wages “more than compensates for their added cost”.

On the other hand, a study of Thailand’s garment factories found that when workers realise that the financial gains resulting from their productivity is not shared with them, they lose motivation and productivity declines.

The quit rate also rises, contributing to higher costs for recruitment and training.

Indeed, when international brands and retailers assessed the competitiveness of suppliers, countries that pay higher wages are rated as providing better quality, value-add, innovation and efficiency in their production.

China and Vietnam are thus regarded as “more critical sourcing bases” and Bangladesh is seen as less competitive.

Data source: Textiles and clothing in Asian graduating LDCs: Challenges and options

Higher minimum wage leads to higher exports and profits

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has set a US$100 billion garment export target by 2030.

Higher wages can help achieve that. Comparing countries with similar population sizes in the left chart below, Thailand and Vietnam pay higher minimum wages and their exports have risen to six times that of Bangladesh. Romania’s population is a tenth that of Bangladesh, but its exports have grown to over twice that of Bangladesh.

On a per capita basis in the right chart, countries with the highest wages (see yellow lines in the chart below) also have the highest exports, followed by those which pay lower wages (blue and green lines). Bangladesh’s minimum wage and per capita exports are the lowest (red line).

Data source: Exports

In terms of garment exports per garment worker, countries which pay higher minimum wages also export more. Again, Bangladesh is the lowest.

Data source: Textile exports, employment in garment manufacturing. Note: The garment exports per garment worker are obtained by dividing the textile exports by employment in garment manufacturing.

Bangladesh’s low exports is also due to its low technological complexity. Countries with higher minimum wages have higher technological complexity, or the ability to produce diverse and innovative technologies.

Bangladesh’s low wages make it difficult to create new technological innovations and open up new markets, thereby limiting Bangladesh’s export potential.

Data source: Technology complexity

Bangladesh’s low minimum wage leads to low domestic consumption and exports, and thus low profits. The Baltics have the highest minimum wages and profits; Kenya’s minimum wage and profits are the lowest. Bangladesh’s economy is at the level of Kenya (as seen in Part 1), and so are its profits.

In Vietnam’s factories, it was found that every 1% increase in wages leads to a 0.6% increase in profits.

The idea that suppressing minimum wage can lead to higher profits is thus misguided.

Data source: Profits (1, 2). Note: Data for some countries is not available.

Higher minimum wage leads to higher productivity and innovation, and therefore higher-value goods and exports, and profits.

Alessandro Caiani, Alberto Russo and Mauro Gallegati explained that it does so by “creating a more favourable macroeconomic environment, which encourages further innovations, stimulates investment, and sustains economic growth”.

On the contrary, low wages lead to lower-value output and factories being exploited alongside workers.

The University of Aberdeen and Transform Trade found that international brands have been pressurising Bangladesh’s factories to reduce their prices. International brands earn higher revenue and sales, but Bangladesh’s factories are paid declining prices.

Centre for Policy Dialogue (CPD) Distinguished Fellow Mustafizur Rahman explained that “buyers are currently paying lower prices to the manufacturers because they are also paying less to the workers”.

Higher minimum wage therefore benefits not only workers, but businesses and the economy.

Bangladesh therefore needs to heed trade unions’ call for a minimum wage of Tk23,000.

This would enable workers to spend to meet all their basic needs, and enable businesses to earn optimally, and to grow domestic profits and the economy faster.