The Financial Express

Virus vexes nearly $2.0b apparel export orders

BGMEA urges German govt, buyers to receive shipments till July

| Updated: March 28, 2020 10:26:33

Evaly and Fianancial Express Evaly and Fianancial Express
An inside view of a readymade garment factory. — FE Photo/Files An inside view of a readymade garment factory. — FE Photo/Files

Amid the outbreak of COVID-19, the BGMEA has requested the German government to encourage buyers in Germany to receive the apparel items already produced in Bangladesh and allow the suppliers to continue production until July this year.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Dr Rubana Huq made the request to Gerd Müller, German federal minister of economic cooperation and development.

She also wrote to more than 40 brands requesting them not to cancel work orders until July, considering the 4.0 million workers and the two upcoming Eid religious festivals.

She made the appeal during last couple of days considering the possible consequences of work order cancellation amid coronavirus outbreak.

The BGMEA chief requested the German minister to encourage the German brands to take all their goods and allow shipments and production to continue at least until July.

"Without this support, we will have a disastrous impact on our labour force and our businesses," Ms. Huq said.

Citing work order cancellation data, she said the number of order cancellation and suspension by buyers, including the leading ones, is increasing day by day.

"I can only urge you to kindly immediately address all your brands sourcing from Bangladesh to not cancel or hold any shipment up," she said in an email communication.

While the businesses in Germany receive government support and address their losses, Bangladesh apparel industry having a different manufacturing reality has an existential problem as apparel makers have to pay their workers, she said.

She mentioned that the suppliers have given the brands an assurance that the buyers can pay the suppliers 90 days later, but the buyers still need to accept the ordered goods.

In the face of cancellation, it is only evident that local manufacturers would fail to pay workers that might create serious social unrest, Ms Huq said, adding that no German brands would like to see that happen in their account.

"This unfortunate occurrence is a disaster that neither humanity nor commerce can afford," she noted.

According to BGMEA data, some 729 factories faced work orders cancellation or hold worth more than US$ 1.96 billion until Monday due to the coronavirus pandemic.

Meanwhile, in a separate video message, the BGMEA president assured that all the garment workers will get their monthly wages timely despite the coronavirus pandemic.

"Don't be afraid, have reliance. All the workers will be paid in time," Ms Huq said, adding that the government has assured all out support to the country's readymade garment (RMG) sector.

She said the buyers have cancelled or held orders worth US$ 1.5 billion in last four days and uncertainty looms when they will ask for shipments of existing production.

Due to such cancellation and suspension of work orders, more than 1.2 million workers will be affected, she added.

Ms Huq urged the BGMEA-member factories not to lose patience, saying that they were waiting for the prime minister's instruction during her speech to the nation scheduled to be given on March 25.

"It is not important whether any factory is closed down, but it is most important to see whether the workers will get the wages," she noted, urging media not to publish any news that might create panic.

She appealed to the global brands to receive the already produced apparel items from the supplying factories. Otherwise, all the factories irrespective of their sizes - be it small or medium and large - would have to face shutdown in next six months, she apprehended.

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