Bangladesh Election Unrest Squeezes Key Garment Sector
On the outskirts of Dhaka, the Ananta garments factory has shortened work shifts to eight or nine hours from the usual 10 and may shutter production lines as months of election-related violence disrupts transport and prompts global retailers to curb orders.
Bangladesh recently concluded elections that ended with Prime Minister Sheikh Hasina's Awami League winning more than two-thirds of parliament seats. The polls were shunned by international observers as flawed and derided as a farce by the opposition Bangladesh Nationalist Party (BNP), who boycotted the vote.
Ananta, which supplies shirts, trousers and other apparel for global retailers including Gap, H&M and Wal-Mart, is one of the biggest players in Bangladesh's $22 billion garment industry that has seen orders cut nearly in half in the last three months - the worst drop in two decades, the Bangladesh Garment Manufacturers & Exporters Association (BGMEA) said.
The company's shipment costs are soaring due to roadblocks and fears of attacks on public and private vehicles instigated by activists.
Ananta Associate Director for Production, Kaiser Hossain, said they have to pay triple to trucks delivering their goods, and security must escort such movements.
"We are suffering a lot of problems here, in products. Workers not coming properly, for 'hartal' and road blocks. And for that reason, our production is going down, day by day," Hossain said.
Ananta's orders from retailers for January have dropped by up to 25 percent, Hossain said, and they may close two to three production lines. They have also halted recruitment.
Anwar Chowdhury, Managing Director of Evince Group, whose customers for garments and fabrics include Tesco, Zara, and Ralph Lauren, says their orders have dropped by as much as 35 percent.
"Customers are really concerned about the investment that they are doing - whether it's been secured or not. Of course, they have to have this kind of feeling because we ourselves are really worried whether all our investment is secured or not. Whether at all we can deliver the goods on time or not," Chowdhury said.
Meanwhile, orders have shifted to other garment-producing countries, such as India, Vietnam, Cambodia and Myanmar.
Bangladesh's garment industry, the world's second biggest after China, employs five million workers, and labour union leader Nazma Akter says about 30 million more working from lorry drivers to canteen owners are dependent on it.
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