The Financial Express

478 apparel factories shut operations in two months

| Updated: May 25, 2020 09:36:00

478 apparel factories shut operations in two months

Around 478 member factories of BGMEA and BKMEA shut operations in past two months with cancellation of orders worth billions of dollars and denial of payment by some Western retailers amid the coronavirus crisis.

In this circumstance, many readymade garment workers in Bangladesh will have no money to spend for their families during Eid-ul-Fitr who spent their final Ramadan days protesting for salaries and allowances, reports bdnews24.com.

A total of 2,182 factories among 2,274 members cleared the salaries of 2.4 million workers for March while 1,878 among 1,926 factories in operation in April paid up their workers, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

BGMEA spokesman Khan Monirul Alam said they do not have the record of how many workers were paid for last month’s work, reports bdnews24.com.

“As many as 348 factories were shut in two months. The others are in trouble as well. The entire sector is in peril,” he added.

The first case of coronavirus infection was reported in Bangladesh on Mar 8, but the garment business began going downhill in February after the worldwide outbreak. Purchase orders worth $3.48 billion have been cancelled.

Many exporters said that the retailers did not make payments though orders were delivered, and it had an impact on the payment of workers, they claimed.

Most of the factories that remained operational cleared workers’ wages for the month of April with bailout funds from the government.

Monirul said 1,377 factories were able to apply for the bailout package. A number of these factories were refused funds on different grounds while 500 others were ineligible to apply and, consequently, failed to pay the workers.

The situation at Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) is worse as its 838 member factories were operational while 130 were shut, according to BKMEA First Vice-President Mohammad Hatem.

He could not say exactly how many factories paid off workers, but did say that 519 had applied for the government stimulus and 420 received it.

The labour ministry had a meeting over the workers’ festival allowance earlier this month. The factories struggling financially were asked to clear at least half of the payments due including allowances, but the labour leaders did not agree.

The failure to pay sparked protests and workers clashed with the police and vandalised factories in different areas of Dhaka, Gazipur, Narayanganj and Savar

Bangladesh Garments and Industrial Workers Federation Chairman Babul Akhtar told bdnews24.com that it was the owners who proposed 50 percent payment for now and the rest within the next six months.

 “But it will be Eid-ul-Azha after two months. How will they delay these payments?” he asked, saying they did not agree to the proposal.

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