Trade
4 years ago

BGBA suggests forming special cell, action plan

Handling pandemic impact on RMG sector  

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Local garment buyers have proposed formation of a special cell for ready-made garment (RMG) sector, comprising of all related stakeholders, to address the problems that surfaced due to the worldwide coronavirus pandemic.

The Bangladesh Garment Buying House Association (BGBA) made the proposal in a letter to the Prime Minister's principal secretary on March 29.

Local RMG sector has been facing the blow of the ongoing Covid-19 outbreak since its initial stage, the BGBA president Kazi Iftaquer Hossain said in the letter.

Due to the coronavirus outbreak, almost all the European Union (EU) countries and the US have imposed partial or full lockdown.

As a result, local exported goods are not released from foreign ports, while other necessary services, including customs, are not being duly available, he noted.

"It is uncertain whether the EU-US buyers will receive the already shipped goods that are in seas or ports or will reach the desired ports shortly."

Due to lockdown, some buyers said they are not able to receive exported goods now, and will receive those once lockdown is withdrawn, Mr Hossain further said.

"But, who will pay the additional charges, as buyers have declined to pay?"

When asked, he said RMG goods worth more than US$ 2.0 billion are in seas or in ports.

Terming the current situation 'usual' considering the present global circumstances, the BGBA president feared of business disputes, which will result in strong bargaining of locally made RMG products.

"In such a situation, we also have to bargain to get fair share."

He also focused on necessity of the government's representation for coordination.

"The government should take immediate measures to protect these goods before they are abandoned." Moreover, an action plan needs to be formulated to help sustain the RMG trade at present and in future, the BGBA leader opined.

Mr Hossain also proposed to form a high-powered committee, comprising of representatives from ministries of commerce, foreign affairs, finance, and jute and textiles as well as officials from customs, Bangladesh Bank and businesses trade-bodies concerned to facilitate export activities of locally made RMG products.

More than 500 buying houses help local manufacturers to get majority of the RMG export orders. Bangladesh fetched $34.13 billion from RMG export in last fiscal year, 2018-19, according to official data.

Meantime, some 1,068 local factories reported that their export orders of about 926.33 million pieces of garment products worth $2.91 billion have been cancelled or held up until Wednesday morning.

However, some buyers, including H&M, M&S, Target, Inditex, Kiabi, Benetton, Decathlon, KappAhl and PVH, have assured local RMG makers of taking their already placed orders after the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) urged them not to cancel or hold up the existing orders.

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