Sunday, 5 February, 2023

Covid-19 – the pulse of our apparel industry!

Covid-19 – the pulse of our apparel industry!

The ongoing life-threatening coronavirus has already caused massive loss of life and economic damage throughout the globe and Bangladesh has no exception with over 81,000 confirmed cases and over 1,000 death. Needless to say that, in the time of pandemic, the private sector has been severely impacted. Coronavirus has brought unprecedented disaster to our RMG industry. This bow comes as the garments exporters are playing a nervous wait about their immediate future in the face of mounting order cancellations as well as for the unprofessional business manner from the brands and retailers in terms of holding payment and demanding unreasonable discounts. After the recent sorry picture of world-famous retailers like EWM, Peacock, JC Penny regarding payment issue, another American based retailer Sears Holdings allegedly refusing to settle more than $40.0m in outstanding dues from 2-dozen Bangladeshi RMG makers. 

According to BGMEA, buyers have so far cancelled orders worth as much as $3.15b since the pandemic unfolded. Factories are now operating less than 50 percent production capacity for shortage of much-needed work orders. Citing a study of Mckinsey & Company, global consumption of cloths is expected to fall by 65 percent for Covid-19 and our work orders also slum by 30 percent. Bangladesh's overdependence on apparel export may lose as much as $5.0b with the outgoing 2019-2020 fiscal year due to slum triggered by the global coronavirus pandemic. Bangladesh was set apparel export target at $37.42b for fiscal year 2019-2020 with a 7.03 percent growth in export earnings. EPB (Export Promotion Bureau) proposed export target, $ 37.42b out of $ 44.40b will come for the country's apparel sector which is over 84 percent of the total target. During July – May, apparel exports stood at $ 25.70b down by 19 percent against $ 31.73b in the same period last year. Apparel export declines by 62 percent in May to $ 1.23b from $ 3.24b compare to last year due to the global crisis of Covid-19.

Our financial sector is already under tremendous stress in the ongoing pandemic. Economy showing sign of sluggishness. In this dire situation, millions of jobs are at stake. Employment creation is now stagnant. Opportunity of job in informal and many formal sectors are shrinking in home and abroad. As per the recent report of ADB (Asian Development Bank), the number of job postings decreased by 87 percent in April this year, in comparison with same month of 2019. The number of job postings in April 2020 was down by 95 percent in textile and education industries, and by 92 per cent in the manufacturing industry.  Business should get a much-needed boost. In this connection, our honourable prime minister Sheikh Hasina has so far announced a total of 19 stimulus packages worth Tk 1.03 trillion to offset the shock of noval coronavirus pandemic on various sectors of the country.

Sustainable approach requires garments industry in the post Covid-19 world. The silver lining is that, the retailers are re-opening their stores phase by phase. One of the biggest retailer of Bangladesh, Primark is going to reopen all 153 stores in England by 15 June. They have 378 stores in all over the world and 189 stores in the UK. So far, they reopened 112 stores in Europe with a decent response. On the other hand, end of June going to reopen the stores for rest of the countries (Scotland, Wales and Northern Ireland) of the UK. Expert says, we have to focus strongly on virtual marketplace like Business-to-Consumers (B2C) idea as online businesses growing daily. Apart from that, product diversification, technology up-gradation, value addition with new items like recycled products, non-cotton products (man-made fibre), circular product items could play a handy role further in the post pandemic period. PPE would also be a vital product in coming days in the context of health and safety issue. Life must go on. Above all we respect the hands that run our machines.