Garment sector weathered global headwinds

Bangladesh's garment sector has firmly weathered the storm of Covid-19 and emerged stronger in spite of the hardships, reaffirming its position as a leader in sustainable and responsible business.

The sector was devastated by the severe fallout of the pandemic, when local apparel suppliers faced a sudden suspension of work orders worth $3.6 billion for around a year or so.

Meanwhile, non-payment, demand for discounts and deferred payments and shipments plagued the industry.

"We all went through such an unprecedented time," said Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), yesterday in a statement reviewing the past couple of years.

"…there was no clear indication about how long it would take for the world to recover from the pandemic, how bad the impact would be on the global economy and our trade, and how long we could hold our breath and stay afloat," he said.

With the rebound, the sector also expects to make annual apparel exports worth $100 billion by 2030 with "sustainability" at its core, he said.

The BGMEA said it had set ensuring workplace safety as its first priority and it thanked government support, which it said was crucial for its sustenance.

The expedited vaccination programme for garment workers was a very timely initiative which helped the economy make a quick turnaround, said the statement.

The pandemic, which began in late 2019, initially took a toll as garment export declined by a massive $6 billion in fiscal year 2019-20 compared to that in fiscal year 2018-19.

But in the following years, the industry thrived.

From $28 billion in fiscal year 2019-20, exports grew to $31.45 billion in fiscal year 2020-21, $42.61 billion in fiscal year 2021-22 and then to $47 billion in fiscal year 2022-23.

Meanwhile, the BGMEA is continually getting new members.

Since 2018, 565 factories became permanent members while 603 factories obtained provisional membership status -- half of which came in the past two years.

In calendar years 2022 and 2023, 278 factories became permanent members and 316 factories received provisional membership.

During the past few years, a good number of factories have also closed down due to various challenges, said the statement.

The challenges include the pandemic-induced impacts, post-pandemic impacts on the global freight system and supply chain, and the impacts of the Russia-Ukraine war and resulting global inflation, it added.

As advanced economies take measures to control inflation, the mortgage rate is being pushed up, also affecting consumers spending and retail sales, it said.