From deadly industry to source of jobs and business prospects
Bangladeshi ship-recycling was known to be one of the world’s most hazardous industries. Each week, another worker would die due to the unsafe working conditions.
End-of-life ships were brought to the coastline where labourers dismantled them manually, right there on the beach. Working without safety equipment at great heights. They carried away huge pieces of steel from dismantled ships without protective clothing. At high tide, it was not uncommon to see oil, asbestos and other toxins wash into the sea, destroying coastal ecosystems. Gas leaks would regularly cause explosions.
The financial sector in Bangladesh is one of FMO’s largest investments in South-East Asia. Most banks in the country, if not all, had legacy exposure to the ship-recycling industry. A $1.5 billion-dollar industry, the sector is renowned for supplying more than 60% of domestic steel and providing jobs for thousands of people. Poor labour conditions coupled with destruction to the natural environment could put FMO’s continued investments in the financial sector at risk. Back in 2009, a high court injunction was issued which required that all ships to be dismantled locally must show proof of having been decontaminated at source before being imported into the country. A full ban went into effect in 2010, putting more than 20,000 people out of work.
A bold and creative solution was clearly needed to break this vicious circle.