[🇧🇩] Textile & RMG Industry of Bangladesh

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[🇧🇩] Textile & RMG Industry of Bangladesh
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Textile units to remain closed

Textile millers will keep their production units closed due to the prevailing volatile situation in the country.

Bangladesh Textile Mills Association (BTMA), which represents the $25 billion primary textile sector, announced the decision in a statement yesterday.

The decision came because of the deteriorating law and order situation in the country and the government's declaration of a three-day holiday from today, the BTMA said.

"The decisions on reopening the mills will be made based on the situation and further declarations from the government," it said.

The BTMA member mills were also shut down for four days two weeks ago due to violence and a subsequent curfew imposed by the government to rein in violence.

The trade body reported that its members lost $58.8 million during the initial four-day closure caused by the violence and curfew.​
 

Garment factories shut down for indefinite period
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A sign on the wall of a garments unit states that the facility is closed due to the imposition of an indefinite curfew by the government because of heightened unrest around the country on the first day of a non-cooperation movement called by students. Photo: Anisur Rahman

Out of fear of vandalism and subsequent losses amid the current spell of violence, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) yesterday instructed all the factory owners to keep their units shut until further notice.

The garment exporters' platform circulated the message among the members through WhatsApp, said Md Ashikur Rahman Tuhin, a director of the BGMEA.

This is yet another blow to the sector as the apparel factories were shut down for four days during the first round of violence two weeks ago though this is the peak season for Christmas shipments and taking work orders for the next summer and spring seasons.

During the violence in mid-July, the exporters could not communicate properly with their business partners abroad because of an internet blackout.

Exporters now fear mounting losses as export performance had already been poor over the last two years because of the severe fallout of Covid-19 pandemic, Russia-Ukraine war, runaway inflation in the Western world, Red Sea crisis and a labour unrest at home.

Amid violence across the country, majority of garment factories were shut down yesterday on the first day of a countrywide non-cooperation movement called by the organisers of Anti-Discrimination Student Movement.

At least 73 people, including 14 policemen, were killed and dozens injured yesterday as fierce clashes took place in different areas in Dhaka and other parts of Bangladesh.

More than 400 garment factories in Narayanganj, Narayanganj BSCIC and Fatullah areas were closed though many of the units ran for some time in the morning.

Some factories were operational in Rupganj and Araihazar areas of Narayanganj district, said Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

Also, almost all the factories in Ashulia, Savar, Maona, Tongi and Chattogram had started production in the morning, but after a few hours the student protests began and some factories were vandalised, leading to the closure of the units.

At least six garment factories were vandalised in Narayanganj BSCIC and its adjacent areas, Hatem said, adding that fearing further escalation of the vandalism, the other factory owners have shut down their units.

Hatem confirmed that the workers left their workplaces peacefully after the shutdown.

"We will sit in meetings soon with the owners, the government and other high-ups on how to run our factories," Hatem said, adding that they will monitor the situation at least for two days.

Factories in Konabari and Kashimpur under Gazipur district were shut down although those were opened in the morning, said Arshad Jamal Dipu, vice-president of the BGMEA.

The factories were shut down anticipating violence, he said but could not confirm how many factories were closed.

He said the factory owners are fearing a shutdown of internet again as two weeks ago they suffered a lot and lost business because of the internet blackout. Exporters could not communicate online with their foreign retailers and brands.

Moreover, this is the time for bond renewal of the export-oriented garment factories and already seven factories have complained to him that they cannot renew the bond licences because of the current crisis, Dipu also said.

The owners are also facing trouble in garment shipment and import of raw materials, he added.

Md Towhidur Rahman, president of Bangladesh Apparel Workers Federation, confirmed that all the garment factories in Kaliakoir area have been shut down by the owners fearing escalation of unrest in the sector.

The owners announced closure to save their factories and other assets, he said.

Nazma Akter, president of Sammilito Garment Sramik Federation, a workers' platform, said that the BGMEA leaders held a meeting with the union leaders on Saturday and asked them to be more responsible during the crisis so that the garment factories could remain safe.

The owners are announcing closure of the factories fearing spread of violence in the sector, she said.

The garment exporters fear that if their workers join the ongoing movement across the country, it will further dent the sector, which was hamstrung for four days when factories were completely shuttered due to violence in mid-July.

The sector also suffered serious repercussions because of a five-day internet blackout, which hindered communications between garment suppliers and international retailers and brands, meaning they could not make business deals or hold meetings.

Last week, international retailers and brands expressed concern at a meeting with the leaders of the BGMEA, flagging the difficulties in communication with their headquarters and local suppliers.

The months of July, August and September comprise the peak season for both shipment of goods for next Christmas and also for booking the work orders from the international retailers and brands for the next summer and spring seasons.

The BGMEA has already said they have incurred losses of Tk 6,400 crore because of the shutdown and internet blackout, while the losses estimated by Bangladesh Textile Mills Association stand at $58.8 million.​
 

RMG exporters expect new vigour in business

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Garment exporters have lost Tk 6,400 crore due to the recent unrest and shutdown of factories, said Bangladesh Garment Manufacturers and Exporters Association. Photo: Star/file

Garment exporters are expecting a strong recovery in exports and business as normalcy is being gradually restored with the changing political scenario.

The business environment was facing an impasse because of the latest spells of violence and frequent shutdown of factories, for which they were unable to manufacture goods for export.

Exporters also said, though July, August and September comprise the peak season for shipping goods meant for Christmas and for booking work orders for the coming summer and spring seasons, they were facing challenges in sending goods to retailers through Chattogram port amid violence.

They were also unable to communicate with their business partners both at home and abroad because of the recent internet blackout across the country and for the violence.

The apparel manufacturers are now planning to reopen their production units and to restart with a new vigour as they have been facing shutdowns, difficulties in transportation and shipment of goods over more than one month because of the political crisis.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) called a meeting yesterday at 7:30pm to discuss the next course of action as the prime minister resigned, said a director.

They decided that the garment factories and textile mills will stay shut for now considering the current situation. The owners may take a decision on factory reopening today.

They had earlier shut down their units two weeks ago for four days amidst violence and curfew. During the first round of shutdown, they could not even communicate with their international clothing retailers and brands because of an internet blackout across the country.

Because of the latest spell of student movement and political impasse, the BGMEA has already said they have lost Tk 6,400 crore while the textile millers said the amount of their loss is more than $58.8 million.

The garment and textile millers have shut down their production units across the country fearing labour unrest and vandalism, which will cause a massive loss for the sector.

During the first round of violence and curfew, the international clothing retailers and brands expressed concern over the situation as they were facing difficulties in placing work orders with factories and receiving shipments of goods from Chattogram port.

"We mainly discussed the issue of reopening the factories. However, we may take more time to reopen the factories considering the change in the political situation," said BGMEA Vice-President Arshad Jamal Dipu over the phone.

"We want to restart production in the factories very soon. But we need help from the administration for the smooth running of the units as their instructions are important for us," Dipu added.

Also, it recently became difficult to do business and international trade because this is the time to renew bond licences but many, especially the Chattogram-based exporters, are complaining that the customs department is not renewing the bond licences.

Many have been forced to adopt expensive air shipments because of delays in production and transportation of goods to the factories.

Also, many have been forced to provide discounts and accept cancellation of work orders from international retailers and brands because of the latest spells of violence and curfew.

Banks are charging a higher interest rate on loans, he said, adding that all these things are affecting business and all those issues need to be broadly discussed with the trade bodies and administration soon for resolving the issues.

"We have to work seriously now," Dipu also said.

"I hope everything will change now and business will soon be restored," said a garment exporter asking not to be named.

The work orders from international retailers and brands will also be restored soon as normalcy has also started to return, the exporter added.

"We are getting ready to reopen our factories as soon as possible," said a director of the BGMEA asking not to be named.​
 

Yunus urges RMG industry to aid in rebuilding economy
United News of Bangladesh . Dhaka 14 August, 2024, 20:42

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| BSS photo.

Nobel laureate Muhammad Yunus, chief adviser to the interim government, called on the country’s garment manufacturers on Wednesday to support the rebuilding of Bangladesh after 15 years of economic plunder under the dictatorship of Sheikh Hasina.

Speaking to the leaders of the Bangladesh Garment Manufacturers and Exporters Association at the State Guest House Jamuna, Yunus emphasised the challenges inherited by the interim government. ‘All the institutions were broken. We were in a mess. They left us in an economic crisis. But with the cooperation of everyone we can rebuild the nation,’ he said, according to a statement from the Chief Adviser’s Office.

BGMEA acting president Khandoker Rafiqul Islam led the delegation in the meeting, where the Nobel laureate highlighted the urgency of the situation. The country cannot afford to fail, he said. ‘Else, its impact will be disastrous. The nation may face an existential crisis,’ he warned.

Yunus also urged the manufacturers to keep their businesses separate from politics. ‘You should send a clear signal that you won’t mix business with politics. It does not help any cause,’ he advised.

Reflecting on the recent student-led revolution, which he described as ‘unprecedented in human history,’ Yunus noted the responsibility placed on the interim government. ‘They have put their trust in us. I was abroad when they called me and urged me to take up the leadership,’ he shared.

The BGMEA leaders expressed their full support for Yunus’s leadership during this critical time for the nation. They requested the formation of a task force to address sector-specific challenges, aiming to restore international buyers’ confidence in Bangladesh. Their demands included relaxed debt repayment terms and adjustments to utility bill payments.

The chief adviser listened to their concerns and promised to address them. ‘We will ensure transparency at every stage. The Bangladeshi people have immense talents. Bangladesh is the world’s second-largest garment exporter. We want it to grow further,’ he stated.

After the meeting, BGMEA director Shovon Islam spoke to reporters, expressing optimism about the future under Yunus’s leadership. As Yunus took charge of the interim government, buyers across the globe are gaining confidence in Bangladesh, he said. ‘We want to utilise that confidence and increase work orders.’

He also outlined the short-term and long-term needs of the industry, including the formation of a task force to address ongoing challenges. ‘We requested him to form a task force with all stakeholders so that it could play a long-term role,’ Shovon Islam added.

He further mentioned the BGMEA’s need for assistance in securing power and addressing liquidity issues, to which Yunus responded positively. ‘In reply, the chief adviser told us he would help us,’ he confirmed.​
 

Bangladesh’s RMG export to EU drops in Jan-June
Moinul Haque 18 August, 2024, 22:40

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A file photo shows workers sewing clothes at a readymade garment factory in Narayanganj recently. Bangladesh’s apparel exports to the European Union in the first half of 2024 declined by 4.98 per cent to 8.72 billion euros compared with those of 9.18 billion euros in in the same period of 2023, according to data from the Eurostat, statistical office of the European Union, released on Saturday. | New Age photo

Bangladesh’s apparel exports to the European Union in the first half of 2024 declined by 4.98 per cent to 8.72 billion euros compared with those of 9.18 billion euros in in the same period of 2023, according to data from the Eurostat, statistical office of the European Union, released on Saturday.

Exporters said that global challenges had impacted all major exporting countries, including Bangladesh.

However, Bangladesh has been more severely affected due to the erosion of its competitive advantages, driven by high utility prices, poor gas supply and recent wage hike, they said.

Although the country’s knitwear exports to the EU decreased by 8.58 per cent in January-June of 2024, the shipment of woven garments witnessed a slight increase by 0.28 per cent to 3.74 billion euros from 3.73 billion euros, the data showed.

Fazlul Hoque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association, said that global challenges impacted all major apparel exporting countries.

He said that Bangladesh had been severely affected due to the erosion of its competitive advantages, driven by high utility prices, shortage of gas and wage hike.

Citing the current situation of the country, Fazlul said, ‘Buyers rarely announce their decisions to shift or cancel work orders outright. Instead, they gradually redirect their orders elsewhere to mitigate business risks.’

He said that one of his buyers was scheduled to place an order for the next season at the end of July, adding, ‘I didn’t receive that order, which means it was likely diverted to other destinations.’

However, Fazlul expressed hope that the exports would recover in the coming months if the political situation stabilised.

The readymade garment imports by the EU from different countries in January-June of 2024 fell by 6.03 per cent to 38.47 billion euros compared with those of 40.94 billion euros in the same period of 2023.

Data showed that the overall reduction of 4.98 per cent in Bangladesh’s apparel exports was slightly better than the global average decline of 6.03 per cent in the EU’s apparel imports.

The Eurostat data showed that apparel imports by the EU from China in the first half of 2024 declined by 7.23 per cent to 9.16 billion euros compared with those of 9.88 billion euros in the same period of past year.

Although China remained as the top apparel exporter to the EU in value, the European Union’s official data showed that Bangladesh obtained the top position in exporting knitwear to the 27 nation economic bloc in January-June of 2024.

Bangladesh’s knitwear exports to the EU in in the first half of 2024 stood at 4.98 billion euros while those of China were 4.51 billion euros.

Bangladesh’s woven garment exports to the EU in January-June of 2024 stood at 3.74 billion euros against China’s exports of 4.65 billion euros in the period.

Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association, said that long lead times were a major factor causing Bangladesh to lag behind its competitors.

The ongoing power and gas crises have hindered manufacturers from utilising their full production capacity and created challenges in procuring raw materials on time, leading to delays of additional 20-25 days in producing goods and making shipments, he said.

Hatem also said that Bangladesh had experienced negative growth not only on the EU market but also in the US and UK.

He mentioned that while Export Promotion Bureau data might have showed growth, the reality told a different story.

Apparel imports of the EU from Turkey in the first half of 2024 declined by 10.95 per cent to 4.59 billion euros compared with those of 5.15 billion euros in the same period of 2023, the EU data showed.

India’s RMG exports to the EU in the first half of 2024 fell by 4.53 per cent to 2.32 billion euros compared with those of 2.43 billion euros in the same period of the previous year.

Apparel imports of the EU from Vietnam in January-June of 2024 fell by 6.16 per cent to 1.70 billion euros compared with those of 1.81 billion euros in the same period of 2023.​
 

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