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'Millions will literally go hungry': coronavirus chaos in Bangladesh

Bangladesh

Cancelled orders and closed factories amid the coronavirus pandemic have plunged Bangladesh’s clothing manufacturing industry into chaos.

As high streets and shopping centres lie empty in cities across Europe, the usual flow of orders to factories in garment-producing countries has come to a sudden and devastating halt. Among the worst hit by coronavirus cancellations is Bangladesh, whose economy relies heavily on clothing exports. Suppliers, and garment workers, are now struggling to survive.

Disappearing domestic demand has resulted in retailers cancelling orders en masse, putting enormous pressure on the industry in Bangladesh and pushing factories to the brink of collapse. More than 1,100 factories in Bangladesh are currently closed and around $3.08bn (£2.4bn) worth of exports – the equivalent of 964 million pieces of clothing – have been cancelled or suspended during the coronavirus crisis so far, Bangladesh Garment Manufacturers and Exporters Association has reported.

In a video published at the end of March, association president Rubana Huq pleaded with international buyers to take delivery of completed orders under existing payment terms to protect people who work in the sector.

“We will have 4.1 million workers literally going hungry if we don’t all step up to our commitment to the welfare of the workers. This is a call we all promised to take a long time ago,” Huq warned.

“Orders are being cancelled by buyers and retailers at a rate we’ve never seen before 

Mostafiz Uddin, managing director of denim manufacturer Denim Expert

“One thing is very clear: our foremost responsibility is towards our workers. We are a manufacturing country. Our reality and your reality is totally different, but it is not a time to point out differences – it is a time through which we need to work together.”

Workers’ rights

Millions of factory workers have been sent home, often without legally mandated pay or severance money, the Center for Global Workers Rights reported last month.

“More than half of Bangladeshi clothing suppliers have had the bulk of their in-process or completed orders cancelled, its report found, and more than half of factories have had to shut operations as a result. When orders were cancelled, more than 70% of buyers globally refused to pay for the raw materials already purchased.

Denim expert bangladesh factory worker

A worker at Denim Expert’s factory in Chittagong, Bangladesh 

“Orders are being cancelled by buyers and retailers at a rate we’ve never seen before,” Mostafiz Uddin, managing director of denim manufacturer Denim Expert in Chittagong and founder of the Sustainable Apparel Forum, tells Drapers. Denim Expert works with high street retailers including Arcadia Group.

“It is crippling the entire industry. If the buyers do not pay the manufacturers, how will the manufacturers pay the salaries to their workers? Without orders, factories cannot remain operational and will go bust.

“Secure work at [garment] factories is a lifeline for millions of families in Bangladesh. How will they survive if the factories do not?”

Simone Cipriani, head and founder of the Ethical Fashion Initiative at the United Nations’ International Trade Centre, adds: “Cancelled orders in a country like Bangladesh have a huge social impact – much larger than we can imagine in the setting of Europe or the US.

As a bare minimum, retailers have to be honouring existing contracts

Dominique Muller, policy director at campaign group Labour Behind the Label

“The impact of coronavirus on businesses in western countries has been bad, but there are at least public mechanisms to mitigate the effects on society. In Bangladesh, the lack of a living wage means workers don’t have the income necessary to deal with any kind of emergency, not only because of current cancellations but because of employment conditions pre-crisis. Workers have not accumulated any kind of financial buffer.”

He adds that desperate workers unable to find alternatives may be forced to find illegal work, including, in some extreme cases, turning to terrorism.

Disease threat

As factories fight to survive, there are also concerns about how densely populated Bangladesh will be able to control the spread of coronavirus, particularly among the country’s poorest. Although at the time of writing the number of reported infections and deaths in the country was still relatively low, millions of people live in slums. Cramped living conditions and limited access to running water make social distancing and frequent hand washing to fight off the virus impossible.

One high street supplier who works with factories in Bangladesh tells Drapers: “Somewhere like Bangladesh is not going to be able to enforce social distancing without a huge slowdown in production.

Some factories are also saying they are taking precautions when in fact they aren’t

Dominique Muller, policy director at campaign group Labour Behind the Label

“How the country will cope with the virus is a worry. Often in garment factories, workers are a metre away or less from each other.

“The situation also poses challenges for retailers, because one of the key characteristics of the Bangladesh apparel sector is high volumes. Retailers will struggle to switch big orders [to other countries] without incurring huge costs.

“The biggest impact, however, will be on the Bangladesh economy, which will be very badly hit.”

Dominique Muller, policy director at campaign group Labour Behind the Label, adds: “This virus affects everyone, and it doesn’t discriminate, but how people experience this virus varies hugely. If you’re a garment worker living in small room and you lose your job, you’ll be forced out on the streets to find work wherever you can and there’s a huge risk of the virus spreading.

“From what we’ve seen and heard, some factories are also saying they are taking precautions when in fact they aren’t.”

Ethical reponse

To help prevent a humanitarian disaster in Bangladesh, suppliers, charities and apparel bodies are calling on retailers to work with factories to share the burden. A handful of retailers are taking this approach – H&M Group, for example, has agreed to pay for already produced garments and goods in production under agreed terms in all sourcing countries, including Bangladesh. The Swedish retail giant will also not negotiate prices on any already placed orders.

Primark has pledged to pay the wages of workers who were producing orders that have now been cancelled. However, critics, including Labour Behind the Label’s Muller, point out that wages do not cover the whole cost of cancelled orders and factories are still left out of pocket.

Muller argues: “As a bare minimum, retailers have to be honouring existing contracts. Some big brands have the power to effectively renege on contracts – they must pay for work that has already taken place. They need to be asking suppliers about employment relations and if all workers are getting legal benefits and compensation.

Brands and retailers should take delivery of the current orders that have already been produced 

Mostafiz Uddin, managing director of denim manufacturer Denim Expert

“Now is the time to step up and not just rely on vague codes of conduct. Retailers also need to be ensuring factories are following World Health Organization guidelines to protect the health of workers.”

Denim Expert’s Uddin agrees: “Brands do not want to lose their supply chains – the world will still need apparel supply chains [after coronavirus], unless we all decide to stop wearing clothing.

“Brands and retailers should take delivery of the current orders that have already been produced or are at different stages of production with the agreed payment terms as per the contracts. Real partnership between brands and manufacturers is now more important than ever, for both sides to support the other and to collaborate to overcome the crisis.”

High street retailers and brands talk about the struggle to survive the coronavirus crisis, but this could quickly become a very literal problem for garment workers in sourcing countries like Bangladesh. Many could fall even further below the poverty line if they are left out of work. The wellbeing of workers in sourcing countries is the responsibility of the entire fashion industry. 

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