Garment order cancellations coming thick and fast
Work order cancellations by international retailers due to the ongoing coronavirus pandemic have cost Bangladesh's garment sector $1.98 billion in revenues by yesterday, exporters said.
The full total value of the task orders which were called off stood at $1.51 billion just the day before.
Work orders for a few 634.8 million bits of garment items have already been cancelled, that too in only 729 registered garment factories, by 6:30pm yesterday, according to statistics from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
"The problem is worsening. Letters requesting the termination of previously placed orders are arriving at us each day," BGMEA President Rubana Huq told The Daily Star over phone.
Although buyers are either cancelling or delaying their work orders every day, wage payments to staff will have be made promptly, she said.
The total value of the cancelled work orders was calculated based on the data of days gone by five days.
Up to now, about 12 lakh personnel have been damaged by the problem, she added.
On the bright side, a few BGMEA member factories are making personal protective equipment (PPE), such as surgical masks and gowns, for doctors and nurses who are struggling to take care of coronavirus patients in the united states.
On the decision whether factories ought to be turn off amid the pandemic, Huq said the BGMEA has advised member factories to consider at their own discretion.
"We don't possess the authority to order any closures. That right is reserved for the federal government," the BGMEA president said.
In light of the country's grim situation, Huq yesterday sent a letter to Gerd Muller, federal minister for monetary cooperation and development of Germany, a major apparel export destination of Bangladesh.
In the letter, the BGMEA chief urged Muller to ask German retailers who source their apparel products from Bangladesh never to cancel or endure their work orders.
"At our end, we are facing uncertainties of an unimaginable extent," the letter read.
The amount of garment factories that have had their work orders cancelled is increasing day by day. A number of the brands and retailers who've cancelled their orders are leading names in the apparel market.
Huq in her LinkedIn account has shared a list of buyers who have cancelled their work orders from Bangladesh.
"While businesses in Germany receive government support to address their losses, we here have an existential crisis as we still need to pay the workers' wages," the letter continued.
The BGMEA even assured several brands that they can delay payment for their orders up to 90 days after delivery, encouraging retailers to verify their orders.
"When confronted with cancellation, it is merely evident that people will neglect to pay our workers that may create a serious social unrest and I know that no German brands would like to see that happen on the account," it said.
This unfortunate turn of events is a worldwide disaster that neither humanity nor commerce are able, Huq added.
"Bangladesh includes a different manufacturing reality. We'd be deeply grateful in the event that you could kindly urge the German brands to take all their goods, and allow shipments and production to continue till July at least. Without this support, we could have a disastrous impact on our labour force and our businesses," she said in the letter.
