COVID forces Bangladesh textile traders to drop prices
A study titled ‘Weakest Link in Global Supply Chain: How the Pandemic is Effecting Bangladesh Garment Workers’ revealed that 80% of the readymade garment manufacturers in the country are struggling because of the pandemic.
Dhaka,
Bangladesh
Since the beginning of the
COVID pandemic in 2020, about 50% of the Readymade Garments (RMG) manufacturers
had to accept orders at lower prices than before, revealed a study conducted by
the Institute for Human Rights and Business (IHRB) and the Subir and Malini
Chowdhury Center for Bangladesh Studies, with support from UNDP Bangladesh and the
Swedish government.
The study titled ‘Weakest Link
in Global Supply Chain: How the Pandemic is Effecting Bangladesh Garment
Workers’ further adds that about 80% of all the Bangladesh
textile exports have been affected in one or another way
because of the pandemic.
According to the study, the buyers
are asking for larger price cuts, in values that are beyond the regular
year-over-year reductions. In March 2020, when the pandemic began, about 77% of
the manufacturers in Bangladesh had orders cancelled without payments made in
advance.
Even now, only 27% of the
suppliers have confirmed that they have been paid in full for most or all of
their orders.
Liaquat Ali, Chairman of Balaka
Stitch Limited, mentioned that they were taking orders at prices much lower
than their production cost. He added that by doing so, they were able to keep
their business afloat and pay the workers without having to go under.
The study further states that
manufacturers now wait for an average of 77 days before receiving payments. 57%
of suppliers who participated in the survey conducted by the research team said
that if the same situation continues, they will be soon forced out of business.
Source: Dhaka Tribune
Image Source: Pixabay
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