Garment and knitwear exporters' lobbying groups BGMEA and BKMEA say 478 of their members had to shut business in past two months with orders worth billions of dollars cancelled and payment denied by some Western retailers.
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 BGMEA.
Speaking to bdnews24.com, BGMEA spokesman Khan Monirul Alam said they do not have the record of how many workers were paid for last month’s work.
“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. They paid the workers with funds from other sources, according to the BGMEA leader.
The situation at BKMEA is worse. As many as 838 of its 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.