COVID-Closed Factories, Canceled Orders Hit Asia’s Clothing Industry

Garment workers in Bangladesh have taken a heavy hit because of the pandemic’s economic disruptions, losing almost $12 billion in wages, a report from CleanClothes.org says.

Makers of garments, textile, terry towel and garment accessories have written to the government, saying they’re set to lose around $119 million per day from just garment exports if factories have to stay shut for any reason.

If factories are kept shut, the workers say, they’ll lose “many work orders” along with billions of dollars.

They’ve asked that the prime minister cut the lockdown period, in the hopes of continuing production and minimizing losses.

There have been protests, too, by workers at Stylecraft Ltd., as workers flooded the streets demanding unpaid arrears for the past few years. The report says workers are owed unpaid wages as well as four years’ annual leave as well as two years of Eid bonuses, which the employers have been delaying.

Garment exports from Bangladesh reportedly increased by 12.55 percent in fiscal year 2020-21 ending June 30, as opposed to the previous year’s numbers, though the country didn’t reach its export target, short 6.89 percent.

In May 2020, as the pandemic was just beginning, manufacturers and retailers all felt the sting of the economy.

PYMNTS writes that there were lost shipments and payments causing problems as the economy ground to a halt because of the coronavirus.

In one instance, Bangladesh-based Denim Expert Ltd. had sent out a shipment and waited weeks without hearing anything back.

The pandemic had an avalanche of adverse effects on physical businesses, shuttering stores and slowing down supply chains. The problems only piled onto the ones existing in Bangladesh and other such places, where many factories didn’t have much of a recourse in getting missing payments back as garment contracts were mostly accommodating to importers. Because of that, manufacturers saw more losses as they had to put in their own money and got nothing back.