Germany assures support to Bangladesh’s garment exporters | The Daily Star
12:00 AM, March 26, 2020 / LAST MODIFIED: 12:40 AM, March 26, 2020

Germany assures support to Bangladesh’s garment exporters

BKMEA says members can shut factories if they don’t have enough work orders

Gerd Muller, Germany's federal minister of economic cooperation and development, on Tuesday assured that Bangladesh's garment sector will have his country's full support in coping with the coronavirus fallout.

Muller issued this notice in response to a letter from Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Huq wrote to the minister on Sunday, urging him to request German retailers to not cancel their work orders with Bangladeshi factories.

Soon after the coronavirus pandemic began, apparel retailers in the west began to cancel their work orders with Bangladeshi manufacturers.

As of 6:00pm yesterday, the total value for work orders cancelled from 936 factories stood at $2.58 billion while it was $2.25 billion the day before, according to BGMEA data.

Work orders for about 800.18 million pieces of garment products have been cancelled so far, affecting the lives of 1.92 million workers, the BGMEA said.

"I greatly hope that we can find an approach that will safeguard the textile industry's survival in both Bangladesh and Germany since millions of people work in that sector," Muller said in a letter.

In order to cushion the pandemic's impact on production-based countries such as Bangladesh, Germany is currently evaluating a number of support measures aimed at ensuring that firms are able to remain in business and safeguard the jobs and incomes of their workers, the response continued.

In an emergency situation such as this, the demand for apparel products, particularly protective medical clothing, is changing, he said.

"I hope that for the interim, Bangladesh will receive orders for these products," Muller said, adding: "Bangladesh is one of the most important partners to the German textile industry and I understand all of your concerns."

The COVID-19 pandemic has had a particularly hard impact on Germany's garment sector with some companies having reported even 70 per cent drop in consumer demand.

The BGMEA's German counterparts fear that almost a third of the country's textile industry is under threat of total collapse.

What makes the situation even more difficult is that it remains uncertain when the coronavirus pandemic will subside.

"Let me assure you that I share your concerns regarding the social distress and the threat to garment factories and their workers in Bangladesh. I response to your letter, I am informing you about my intent to pass your urgent request to the representatives of the German textile industry," Muller said.

Earlier this week, the BGMEA issued a letter to the Prime Minister's principal secretary, seeking banking and policy support to help face the challenges brought on by the pandemic.

In the letter, the BGMEA said that due to work order cancellations, the apparel manufacturers will find it very difficult to make payments on letters of credit, wages and utility bills.

Therefore, the BGMEA seeks all forms of government support, including the provision of an interest-free loan with a tenure of three years within the next six months.

In a notice, the BGMEA said that member factories are continuing production.

Besides, the head offices of those factories are also open to aid production and support workers.

Garment factories are excluded from the purview of the government declared general holiday, the BGMEA notice said.

However, the BGMEA also urged companies to take adequate safety measures if they keep their factories operational during the ongoing coronavirus outbreak.

In a separate notice, AKM Salim Osman, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), suggested that member factories should shut down if they do not have enough work orders.

Factory owners should make wage payments to their workers in a timely manner to avoid any kind of labour unrest, Osman added. 

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