Rubana Huq, President of the Bangladesh Garment Manufacturers and Exporters Association, has issued an urgent appeal to European clothing brands not to cancel their orders or defer payments in light of the COVID-19 crisis. In the statement, she warns that factories are on the verge of closure, putting millions of workers and their families at risk of ending up jobless on the streets – a “social chaos which [Bangladesh] cannot afford.” Huq’s plea is a stark reminder of the economic ripple effect of the coronavirus pandemic, and the severe but overlooked consequences that a global economic slowdown will have on the world’s poorest nations.
Across Europe, clothing stores have been forced to close to protect both customers and staff and stem the spread of the virus. The value fashion giant Primark shut all UK shops on the 23 March. Asia’s $290 billion textiles industry, which manufacturers approximately 60% of the world’s garments, textiles and footwear, will suffer the knock-on effects as US and European retailers such as Primark, H&M and Zara cancel orders with garment factories in countries including Bangladesh, India and Myanmar. In Bangladesh, “more than $2.6 billion worth of orders have already been canceled” and new cancellations are coming up, according to Commerce Minister Tipu Munshi. Crucially, Bangladesh’s economy is heavily dependent on it’s apparel trade: in 2018-2019, ready-made garments comprised 84.21% of the country’s total exports worth $40.5 billion, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). More than 60% of the garments were shipped to the European Union. The loss of business will have a devastating impact on these already fragile economies.
Western governments have thrown a series of lifelines to struggling businesses during the pandemic. Trump has committed a staggering $2 trillion to bailout the economy, whilst in the UK government grants will cover 80 per cent of the salary of retained workers. South Africa, another textiles hub, 80,000 clothing and textiles workers are set to receive full pay for six weeks. However, governments in Asia do not have the financial means to support businesses or protect employees throughout the crisis. Huq has cautioned that as many as 4.1 million Bangladeshi workers could end up unemployed and on the streets as a consequence of cancelled orders and deferred payments. The picture is bleak across South-East Asia. In Myanmar, pregnant 31 year old Aye Su Than has told how she was left unemployed and unsupported when Hunter Myanmar, a factory which makes clothes for an Italian fashion brand, was forced to close its doors and lay off 900 workers. At five months pregnant, Aye Su Than is deeply concerned about the future. The risk that millions of low-wage workers could be left jobless, and therefore hungry and homeless, is very real.
In times of crisis, we have a tendency to turn inwards and focus on our own struggles and needs. Yet today’s global economy means that doing so neglects some of the poorest countries in the world, who rely on international trade and will most keenly feel the effects of economic slow-down. It is more important than ever that Europe and the US understand their power within the global economy and do what they can to minimize the impact on vulnerable countries. In the case of the clothing industry, it’s vital that fashion retailers heed Huq’s appeal and do not cancel orders or defer payments. Bangladesh and Myanmar have, luckily, so far escaped the direct impact of the virus, having only recorded a handful of cases. However, both countries could see millions suffer from starvation and become indirect victims of the pandemic. As Huq remarked, “this is a disaster that neither commerce nor humanity can afford.”
- SAGE And The Truth Behind ‘The Science’ - May 3, 2020
- Coronavirus Profiteers: The Pandemic And Organised Crime - April 27, 2020
- In The Philippines And Elsewhere, Coronavirus Is Enabling Human Rights Abuses - April 13, 2020