The country is witnessing an economic stalemate with industries being temporarily closed in the aftermath of global supply chain disruptions due to the coronavirus pandemic. The virus outbreak took a huge toll on all sectors including the trading of garments, leather and leather products, apparel sector accessories, cosmetics, printing industry, medical equipment, computers and parts and electronic products, industry insiders said.
Apparel traders are under pressure to afford their expenses including bank loans and pay staff salaries as global buyers cancelled orders, they added. Experts said, country’s businesses are going through big challenges in trade and investment, exports and imports The businesses and the government should work together to overcome the economic shock, they added.
According to Bangladesh Garment Manufacturers and Exporters Association (BGMEA) data, the global buyers so far have cancelled more than $3 billion of orders. BGMEA President Rubana Huq said they are under pressure to allow reopening of 856 factories. As global buyers cancelled over $3 billion of orders so it’s crucial to reopen the factories, she added.
Rubana said they want to reopen the factories zone-wise in a limited scales way and under a timeframe to be decided later. The country’s export earnings in first eight months of current fiscal (FY20) stood at $26.24 billion, decreased by 4.79 percent compared to that in the corresponding period of the previous fiscal of $27.56 billion, according to Export Promotion Bureau (EPB) data.
In last fiscal year 2018-19, the country fetched record $40.53 billion export earnings, up by 10.55 percent over the previous fiscal. The inflow was $36.66 billion in fiscal 2017-18. Official data show export earnings from readymade garments, which accounts for more than 84 percent of the total export earnings, went up by 11.49 percent during the FY19 from $34.13 billion in the previous fiscal.
Bangladesh Chamber of Commerce and Industry (FBCCI) President Sheikh Fahim said the FBCCI was working with Prime Minister’s Office, finance and commerce ministries, Bangladesh Bank and other trade bodies. Besides, the government was talking to international bodies like World Health Organization, International Labour Organization to prepare a set of health protocols for the factories in line with global standard.
Former BGMEA President Md Siddiqur Rahman said, “Businesses suffer but government’s incentive not enough and interest-free banks loans are essential now.” Besides, deadline for bank loan payment should be extended and interest on previous loans is deferred, he demanded.
Economists said the government needs a new plan to overcome the situation and must reopen export-oriented factories in phases with maintaining health standard. They said the government should ensure proper utilization of incentives taken during the crisis in all sectors and spend the money in a transparent and accountable way.
Industrial areas as well as entire country should be categorized in red, yellow and green colours, said Executive Director of Policy Research Institute Ahsan H Mansur. Trade bodies -- FBCCI, BGMEA and other sectors should work together to prepare sector-based health protocols to the resume factories, he added.
Appreciating the government’s stimulus package on coronavirus, Ahsan insisted that more inactive should be taken. Eminent economist, Zahid Hussain told Bangladesh Post, “Industries are going through many challenges as coronavirus stopped activities in country. “More policy support and loan with low interest is necessary to overcome the losses,” he added.
Workers fears to lose jobs as companies are closed temporarily with small businesses passing a critical time. So the government should provide cash incentives to the industry sector to tackle situation, Zahid said.
