As a result of the coronavirus crisis, Bangladesh risks losing almost six billion euros in export turnover. Millions of jobs are at risk as major retailers cancel their orders in the world's second largest clothing producer (after China).
Six billion dollars lost
"How much longer can we last?", Bangladeshi Siddiqur Rahman asks Business of Fashion. Rahman is an exporter of ready-to-wear clothing that supplies H&M and Walmart, among others. The situation in his country, which has no less than four million workers in the textile industry, is dramatic, as other players in the sector also confirm.
It is estimated that almost six billion euros in export earnings may be lost, as many of the world's largest brands and retailers have already suspended or cancelled their orders. According to local industry organisations and producers, cancellations are increasing every day. Many factories will have to close their doors if this trend continues.
All orders cancelled up to July
According to the association for knitwear manufacturers and exporters, all orders have been cancelled or suspended until July, but suspended orders will eventually be cancelled as well. It takes three months for orders to be delivered, so if retailers do not get their orders in quickly, it will be too late.
The federation claims that it has already lost almost three billion euros due to the coronavirus crisis, but this figure will increase further. For the BGMEA, another clothing industry association with 1048 affiliated factories, almost as many orders have been suspended or cancelled. The jobs of some two million workers are at risk.
A national disaster
Primark has confirmed to be one of the clothing chains that are cancelling their orders. With already large volumes of goods in stock that cannot be sold at the moment, the chain is refusing to accumulate more unsaleable stock. The retailer says it is currently losing 807.82 million dollars (about 740 million euros) per month.
With garments accounting for 84 % of Bangladesh's total exports, the situation could turn into a national disaster. Prime Minister Sheikh Hasina has presented a 540 million dollar support programme to help pay affected workers. However, the garment sector considers these measures insufficient.