Bangladesh’s microenterprises embraced green growth and thrived–then COVID-19 hit
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“It used to take me two hours to set pearls on a shoe,” says Khaled, a 33-year old microentrepreneur in the administrative region—or Upazila—of Bhairab, near Dhaka. “Now, thanks to the new machine, I can set more than two dozen at the same time!”
Home to 7,000 factories, the region is known as the shoe cluster of Bangladesh. About 40 percent are micro-enterprises that employ between two to seven workers. Like Khaled’s business, most microenterprises are family-run and produce shoes for the domestic market for as low as $1.25 a pair.
The project directly supports 40,000 micro-enterprises across Bangladesh. It has encouraged non-banking financial institutions to support green growth initiatives and shift their portfolio assets to include environmental protection, pollution and contamination reduction, and better workplace safety—considerations that are too often overlooked among Bangladesh’s microenterprises.
In Bhairab, greener practices and an improved working environment have helped boost local shoe business.
Bhairab is one of 42 microenterprise shoe clusters financed by the World Bank’s Sustainable Enterprise Project
The shoe cluster used to be a squalid and dangerous place. Solid waste was everywhere, contaminated water sat on the surface, and there were no sanitation facilities. Obsolete factory equipment such as leathers, plastics, or glue was hazardous to workers as they would squat by the machines and amid raw materials.
“I used to apply glue with bare hands, now we use brushes and personal protective equipment and even have a separate toilet for female workers,” said Shirina, an employee at the Ruma Baby Sandal Factory. “Working conditions have improved a lot. We feel good to work here now.”
Other local microenterprises have followed suit. Safety signs, personal protective equipment, first-aid kits, energy-efficient lights, and separate toilets for women have become the norm. Recycling, reuse, and technological innovations have also reduced overall wastage.
Bangladesh’s economy is dependent on its 7 million microenterprises, which provide 56 percent of all jobs
Investing in a green recovery after COVID-19
But the COVID-19 pandemic got in the way, and nationwide general holidays have lowered production and driven down profits, triggering job cuts for factory workers.
As cash reserves dry up, small businesses will find it hard to rehire employees and repay loans, jeopardizing their access to future credit and their very survival. Factory owners have already decided against purchasing new and improved machines, striking concerns for the quality of their products.
In past crises, microenterprises did not get the support they deserved from policymakers. Now is the time to invest in environmentally sustainable enterprises that provide better and quality jobs and contribute to Bangladesh’s economy without harming its natural resources.
This is the first in our series of blogs on microenterprises in Bangladesh. Our next blog will discuss the impacts of COVID-19 on microenterprises.
Great blog, enterprises can be green even at a micro-scale is a great lesson for countries as they turn to economic recovery programs. Look forward to reading the next blog in the series.
Very informative blog, indeed. I'm interested to read more on micro-enterprises.
This is Wajahat from Pakistan. I am on a mission to train and nurture 1 million micro-entrepreneurs by 2024 (50 percent are women)
So far we have worked with 575 micro-entrepreneurs in Punjab, Sindh & KP provinces. 287 out of them launched their micro-enterprises successfully, and created (on average) 3 jobs in 9 to 12 months time.
However, these were govt. and donor projects. One of the key lessons we learnt was to have a self-sustainable & a scalable business model around it. We now have developed one. And we are executing it.
The idea is to ultimately have Innovation hubs in every district & tehsil - following our philosophy of "Local problems. Local solutions. For the locals. By the locals"
Good initiative to improve the micro-enterprise sector of Bangladesh
inspiring prospect for Bangladesh
Where can we find specific numbers related to environmental aspects tackled by the program? Specifically, how the program attributes GHG emission reduction, reduction of pollution load, and volume of waste disposed?
It is inspiring how these micro-enterprises are coping with the adverse situation posed by the pandemic!
I will like more information
Great initiative, please can roll out such programs in PNG?
This is an very development systems
It's a grate achivement of OSACA. I am proud to be a service holder of OSACA.