Two weeks after protests began in Bangladesh, the ongoing transport blockade continues to impact the nation’s textile and apparel sector while violence has claimed the lives of 30 people and injured many more.
According to estimates from the garment industry, losses of more than 7 billion taka, or $89 million at current exchange, have been incurred in the last two weeks.
Although the country is the second-largest apparel exporter in the world after China, shipping $24.5 billion worth of goods, and garments comprise more than 80 percent of exports from Bangladesh, fear of losing business has continued to propel change in the last two years. After the collapse of Rana Plaza in April 2012 killed 1,133 workers and several factory fires also caused the deaths of workers, the apparel industry has been working to improve safety conditions with the help of global brands and retailers.
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In December, optimism was high as an Apparel Summit in Dhaka attracted stakeholders from across the world including retailers, brands, academics, economists, factory owners, and government officials. A road plan for more consolidated growth that would benefit global brands and retailers as well as the industry in Bangladesh appeared to be emerging.
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“That can only go ahead now if there is some political stability,” said a factory owner, requesting anonymity. “It’s not about the political warfare, but rather about being able to pay our workers and survival for us.”
The transport blockade was called for by the 20-party opposition coalition led by Khaleda Zia of the Bangladesh National Party (BNP). The ruling Awami League was just short of marking a year into its second term on January 5 when the trouble broke out. Opposition parties were barred from holding demonstrations protesting the validity of the election – which they had boycotted in the previous year. Zia called for an indefinite traffic blockade as a result, but police confined her to her office building. Zia said the blockade would continue until further notice.
Garment factory owners are concerned about shipments that are due, and about the ensuing loss of faith by global brands and retailers.
“Although loading and unloading operations are normal at Chittagong port, the movement of import and export goods, raw materials, and consumer items has considerably slowed down,” said Md Mahbubul Alam, president of the Chittagong Chamber of Commerce and Industry (CCCI). He estimated the overall loss of exports over the last 15 days to be 6.95 billion takas, or $89 million.
While Zia is accusing the government of holding up a false democracy, Prime Minister Sheikh Hasina said on Thursday in Dhaka that the prevailing situation in Bangladesh was “like a temporary black cloud” which the country was capable of handling.
Factory owners have been calling for an urgent dialogue and consensus to settle the situation before “more orders are lost, and the faith in the garment industry is shaken,” an official of the Bangladesh Garment Manufacturers and Exporters Association said. “All our hopes of growth for the next few years as we invest in our factories for more safety are embedded in a stable political situation.”
Hossain Khaled, president of the Dhaka Chamber of Commerce, said Wednesday that overall industry losses from the 16-day blockade stood at 22.77 billion taka, or $292 million, a day. He said that the only way to resolve the ongoing political crisis is through dialogue.
A similar situation in 2012 that lasted a total of 85 days cost Bangladesh losses of more than $130 billion, according to estimates from the World Bank.
At a policy roundtable session in Dhaka on Tuesday, Atiqul Islam, president of the BGMEA urged the economists, thinkers and industry representatives present to help find a resolution for the situation, citing the pressures facing the industry as costs of compliance, higher wages and other costs were already adding pressure.