Bangladesh garment sector incurs $20m loss

The country’s readymade garment sector has incurred a loss of US$20 million as at beginning of January due to cancellation of orders, extra-costs of air freight, delays in shipments, discount and vandalism in the wake of non-stop political unrest since 1 December 2013, according to a survey by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).


Bangladesh garment sector incurs $20m loss


The country’s readymade garment sector has incurred a loss of US$20 million as at beginning of January due to cancellation of orders, extra-costs of air freight, delays in shipments, discount and vandalism in the wake of non-stop political unrest since 1 December 2013, according to a survey by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

The survey of over 38 export-oriented factories has indicated each of the factories faced order cancellations totaling US$5.35 million and had to spend additional money of over $1.56 million for air shipment. The survey also said those factories also had to pay $1.87 million in penalties as they failed to ship the products on time. Apart from this, vandalism which occurred during the blockades cost the exporters $2.8 million while the delays in shipment cost $9.21 million during the period.

“If such turbulent situation is prolonged, Bangladesh has to face the dire consequence in export earnings,” said BGMEA vice president Shahidullah Azim. It might lead this export earning sector to deeper crises in the coming days and could also see buyers shift their orders from Bangladesh to other countries, he added in a Dhaka Tribune report.

Since 1 November the country has been going through series of blockades and strikes enforced by the opposition, disrupting supply chains across the country. According to BGMEA, since then there were 41 days of strikes and blockades.