At least 24 apparel factories shuttered in Bangladesh for losses

BDApparelNews Desk
25 May 2019  

Apparel factory workers walking to their factories. Photo Courtesy: BBC

Apparel factory workers walking to their factories. Photo Courtesy: BBC

At least 24 apparel manufacturing factories have been forced to shut down in Bangladesh for losses since the implementation of new pay structure for workers back in January 2019.

Insiders in Bangladesh Garments Manufacturers and Exporters’ Association (BGMEA) say the shuttering of factories has left over 12,000 workers jobless. But labour leaders say, the number would be far lesser since most of the shuttered factories were sub-contracting units.

BGMEA Vice President MA Rahim told Bangladesh Apparel News that 24 factories have been closed since January, rendering 12,637 workers jobless. “They were all medium and small factories who closed down because of not being able to cope up with costs.”

“We suffered a double blow. The hike in workers’ wages is a big expenditure. Also, the buyers promised us to raise the pricing; instead they lowered the prices further. Our industry is currently reeling under the pressure of this double blow,” he said.

According to him, even the bigger factories in Bangladesh, which employs over thousands of workers alone, are currently facing a crisis due to this double blow.

BGMEA President Rubana Huq has reportedly said, some 14 factories shut down in May alone, unable to bear the burden of the wage hike of workers, low prices of buyers, and poor orders.

Insiders and industry stakeholders have said, about 60 other factories have been marked vulnerable and prone to closure. They are fearing that unrest might break out at these factories when they will be unable to pay the workers ahead of Eid-ul-Fitr.

Jolly Talukder, general secretary of Garments Workers’ Trade Union Centre, told Bangladesh Apparel News that most of the factories that shut down over the recent months were sub-contracting factories, and the others were relocating from Dhaka to elsewhere.

“The picture is not as grim as the garment manufacturers want to paint. Statistics show that the exports are rising every month, at more than 10 per cent rate. Also, many of the workers who lost jobs have already rejoined other factories,” she said.

Bangladesh government has already instructed BGMEA to convey the message to clear apparel workers’ Eid bonus by May 30 and wages of 20 days by June 2. The government acknowledges that some factories may not be able to comply, and therefore has directed them to come to a solution through discussion with the workers.