Revolutionizing Bangladesh's Textile Industry: UNIDO's SWITCH2CE Initiative Paves the Way for Circular Transformation

In line with its mandate to promote and accelerate sustainable industrial development, the United Nations Industrial Development Organization - UNIDO actively promotes the concept of circular economy. The circular economy is a new way of creating value, an economic model that aims to maximize the use of resources by keeping them in use for as long as possible, reducing waste, and minimizing the environmental impact. Bangladesh’s textile and garments value chain is now part of this transformation.  

One of the flagship UNIDO-led projects with a focus on enabling circular economy solutions is the SWITCH to Circular Economy Value Chains (SWITCH2CE) project. It is co-funded by the European Union and the Government of Finland and implemented in collaboration with Chatham House, Circle Economy Foundation and the European Investment Bank – EIB. This global project recognizes that the application of circular economy practices requires coherent practices by all actors of the value chains, and therefore supports piloting of innovative circular solutions jointly implemented by EU-based multinational companies and their suppliers from developing countries. While focusing on resource-intensive sectors such as plastic packaging, textile, and electronics, SWITCH2CE implements four pilot projects in three countries: Bangladesh, Morocco, and Egypt. The main objective is to facilitate a just transition to a climate-neutral and circular economy, sustainable growth, job creation, and a healthier, pollution-free environment.  

In Bangladesh, the SWITCH2CE project focuses on the Textile and Garments value chain, providing a unique opportunity to accelerate the shift to circularity in the sector. UNIDO is implementing this project jointly with Ministry of Commerce, Government of Bangladesh for achieving these transformations. The global project partners collaborate with a number of local partners in Bangladesh, including the Bangladesh Garment Manufacturers and Exporters Association - BGMEA, to ensure local ownership, capacity development, and sustainability of the action.  

The need for Circular Switch in Bangladesh Textile and Garment Sector  

Bangladesh, renowned as the world's second-largest garments exporter, owes much of its economic prowess to the textile and garment industry, which contributes a staggering 85% to the nation's export revenue and employs over 4.2 million Bangladeshis directly. Moreover, it is estimated that the sector indirectly supports the livelihoods of approximately 40 million people.  

Despite these impressive figures, the industry faces a pressing challenge to become more sustainable and efficient, and the transition to a more circular business model and processes can address this challenge. Presently, there is a substantial deficiency in both the business rationale and the local capabilities required to handle recycling solutions for blended and pure cotton textile waste. This deficiency not only triggers environmental and health concerns but also economic losses. Bangladesh also contends with a daily volume of around 300 million tonnes of PET bottle waste. But the lack of accessible models and technologies for the traceable conversion of PET bottles into Polyester Staple Fiber (PSF) means that local producers miss a valuable opportunity to reintegrate PET bottles into textile production. Consequently, Bangladesh remains shackled by a heavy reliance on imported virgin materials, resulting in a soaring carbon footprint, increased logistics costs, and longer lead times. 

In the backdrop of these challenges, the market is witnessing mounting demands from key stakeholders and buyers, such as the European Union, for the textile and garment industry to embrace circular practices. These demands are compelling the industry to adapt and evolve. Coupled with supportive legislations and ambitious targets, this transformation is fostering a powerful incentive for growth and expansion within the sector. Importantly, this circular shift aligns with the Government of Bangladesh's commitment as outlined in the 8th five-year plan. This commitment seeks to integrate the principles of a circular economy, thus making a pivotal contribution to the Sustainable Development Goals and environmental objectives. 

In summary, the need for a circular switch in Bangladesh's textile and garment sector is no longer a matter of choice but a compelling necessity. The industry stands at the precipice of a transformative journey that promises sustainability, growth, and a brighter future for all stakeholders involved. 

The SWITCH2CE approach  

To achieve the circular switch of the textiles and garments value chain in Bangladesh, SWITCH2CE takes a multiprong approach:  

What

SWITCH2CE will bring for the sector and Bangladesh 

The Switch to Circular Economy Value Chains project promises a significant transformation for the textile and garment industry in Bangladesh. Through the adoption of circular economy business models, businesses will enhance their competitiveness, embracing social responsibility and sustainability. This shift will lead to more efficient and cost-effective sorting and recycling solutions, reducing the industry's reliance on virgin materials and imports. Additionally, the project will foster improvements in the local capacities, policy landscape, business environment, and investment climate to support circular economy initiatives. This, in turn, will create green and circular jobs within the industry, with a strong emphasis on gender inclusion. The project will drive innovation and disseminate knowledge, equipping the industry with the readiness and capacity building needed for sustainable growth, benefiting stakeholders, suppliers, and policymakers alike. 

For further information: www.switchtocircular.eu